REPORT  ON  THE 
TEACHERS' RETIREMENT  ¥U 

CITY  OF  NEW  YORK 


COMMISSION  ON  PENSIONS 
City  of  New  York 


liiiiiii 


!lW!!i 


REPORT  ON  THE 
TEACHERS'  RETIREMENT  FUND 

CITY  OF  NEW  YORK 


This  report  was  approved  for  publicatii 
purpose  of  conference  and  discussion, 
of  the  Commission  on  Pensions,  on  < 
at  which  there  were  present  and  voting  in  the  af- 
firmative, Messrs.  Bethell,  Bru^re,  Boiling,  Chorosh, 
deRoode,  Haag,  Hahlo  and  Wolfe,  and  Mrs.  Cothren. 


>lication,  for  the  / 
ion,  at  a  meeting  / 
.  January  5,  1916,_j 


COMMISSION  ON  PENSIONS 

City  of  New  York 

1915 


THE  TROW    PRESS 
NEW  YORK 


CONTENTS 

PART  I— INTERPRETATIVE  AND  CONSTRUCTIVE 

REPORT 

CHAPTER  I— INTRODUCTION 

PAGE 

Advance  Consideration  of  Teachers'  Fund  Necessitated  by  Its  Bankruptcy 9 

Exhaustive  Inquiry  as  Foundation  for  Conclusions  Reached 9 

Present  Plan  Defective 10 

Tentatively  Suggested  Reorganization  Plan 11 

Comparative  Statement  of  Provisions  Now  in  Force  and  Those  Tentatively  Recom- 
mended   12 

Financial  Statement — Balance  Sheet  as  of  June  30,  1914 15 

CHAPTER  II— PRESENT  PENSION  PROVISIONS 

Pensions  Should  Promote  Efficiency  of  Service 16 

Retirement  Without  Regard  to  Incapacity  Unjustifiable 16 

Half -pay  Pensions  Regardless  of  Length  of  Service  Inequitable 16 

Pensions  Based  on  Final  Salary  Inequitable 17 

Uncontrolled  Disability  Retirements  Result  in  Unwarranted  Expense 17 

Crediting  of  Outside  Experience  Without  Payment  of  Contribution  Arrears  Unwar- 
ranted   19 

Special  Privileges  of  Hunter  College  Teachers  Unwarranted 20 

Uniform  Provisions  for  Men  and  Women  Teachers  Questionable 20 

Divided  Responsibility  Handicap  to  Effective  Administration 20 

CHAPTER  III— COST  OF  PRESENT  PLAN  UNDER  EXISTING  METHOD 

Two  Methods  of  Meeting  Cost  of  Pensions 22 

Teachers'  Retirement  Fund  Operates  on  "Cash  Disbursement"  Basis 22 

Pensions  Will  Amount  to  More  Than  20  Per  Cent,  of  Salaries 23 

Actuarial  Forecast  of  Future  Police  Pensions  Indicates  Rapid  Increase  in  Pension  Roll 

is  Inevitable 25 

Experience  of  City's  Pension  Funds  Illustrates  Growth  of  Pension  Demands 26 

Reorganization  Necessary  to  Prevent  Future  Disappointment 27 

Indirect  City  Contributions  Hide  Cost  of  Pensions 28 

CHAPTER  IV— RESERVE  OR  "THINK  OF  THE  FUTURE"  PLAN  AND 
THE  PRESENT  FUND 

Advantages  of  Operating  Fund  on  "Reserve"  Basis 29 

$54,700,000  Deficiency  on  June  30,  1914 29 

Rapid  Increase  in  Shortage  Since  That  Date 31 

iii 


ivr713244 


CHAPTER  V— OPERATION  OF  THE  PRESENT  FUND  ILLUSTRATED 

PAGE 

Average  Entrance  and  Retirement  Ages 32 

Comparison  of  Aggregate  Pay  and  Pension  of  Average  Teacher 32 

Value  of  "Average"  Teacher's  Pension  on  Theory  of  "Deferred"  Pay 34 

Value  of  a  $1  Pension  and  Average  Lifetime  of  Pensioners 37 


CHAPTER  VI— A  TENTATIVE  REORGANIZATION  PLAN 

Reasons  for  Submission  of  Tentative  Reorganization  Plan 39 

Summary  of  Tentative  Suggestions  for  Reorganization 40 

Definition  of  Problems  Which  Must  Be  Faced 42 

Present  Pensioners 42 

Teachers'  Pensions  Only  Small  Part  of  City's  Total  Pension  Roll 42 

City  Legally  Unable  to  Furnish  Additional  Aid  to  Present  Pensioners 43 

City  Should  Reduce  Liability  to  Pensioners  and  Assume  Payment 43 

Burden  of  Liability  Should  be  Equally  Divided  Among  Taxpayers  of  Next  Sixty 

Years 45 

Teachers  Now  in  Service 46 

Discounted  Value  of  Future  Pensions  to  All  Municipal  Employees  Now  in  Service 

Approximately  $170,000,000 46 

City  Legally  Unable  to  Guarantee  Future  Pensions 47 

City's  Interest  to  Give  Financial  Support  to  Fund 47 

City  Must  Protect  Its  Interest  by  Insisting  on  Fotir  Fundamental  Conditions ...  47 

Details  of  Suggested  Pension  Provisions 50 

Details  of  Contributions  by  Teachers 52 

Application  of  Provisions  Illustrated  by  Eight  Individual  Cases 55 

Superannuation  Retirement  and  Contributions 55 

Disability  Retirement 57 

Return  of  Contributions 59 

City's  Contributions  on  Account  of  Teachers  Now  in  Service 59 

New  Entrants 60 

City's  Retirement  Problem  Not  Limited  to  Teachers 60 

Benefit  Provisions  Suggested  for  Present  Teachers  to  Apply  Also  to  New  Entrants  61 

New  Entrants  Required  to  Contribute  at  Lower  Rates  Than  Present  Teachers . .  61 

City  Should  Contribute  Currently  on  Account  of  New  Entrants 61 

Comparative  Cost  of  Present  and  Proposed  Benefits  Shown  by  Total  Contribu- 
tions Required  of  New  Entrants 62 

Service  or  Superannuation  Pension 62 

Disability  Pension 63 

Withdrawal  Benefits 63 

All  Benefits  Combined 64 


CHAPTER  VII— SUMMARY  OF  RECOMMENDATIONS  FOR  FINANCING 
FUND  REQUIREMENTS 

Plan  Proposes  Definite  Settlement  of  "Deficiency"  Problem 65 

Contributions  of  Teachers  and  City 66 

Perpetual  Solvency  Guaranteed  by  Provisions  for  Future  Adjustments 67 

60- Year  "Deficiency"  Contribution  Provides  for  Perfection  in  Financial  Basis  of 

Plan 67 

Method  Adopted  by  Liverpool  Contemplated  by  Other  Cities 68 

Example  of  Compromise  on  "Semi-Reserve"  Plan 69 

iv 


PART  II— DESCRIPTIVE  REPORT 

CHAPTER  VIII— THE  EXISTING  FUND  AND  THE  MACHINERY  FOR 
ITS  ADMINISTRATION 

PAGE 

Benefits  Paid  by  Fund 73 

Reinstatement  of  Teachers 74 

Income  of  the  Fund 74 

Administration  of  the  Fund 74 

Organization  Provided  for  Administration 75 

Procedure  in  Granting  Service  Pensions 76 

Procedure  in  Granting  Compulsory  Superannuation  Pensions 76 

Procedure  in  Granting  Disability  Pensions 77 

Pensions  to  Hunter  College  Staff 77 

Procedure  in  Payment  of  Pensions 77 

Accounting 78 

Expense  of  Managing  Fund 78 

CHAPTER  IX— THE  ACTIVE  SERVICE 

Employees  to  Whom  Pension  Provisions  Apply 79 

Requirements  for  Entrance  Into  the  Service 80 

Hours  of  Work  and  Vacation  Periods 80 

Medical  Supervision  of  the  Teaching  Force 81 

Sick  Leave  Allowances 81 

Discontinuance  from  Active  Service 82 


CHAPTER  X— ESTABLISHMENT  AND  DEVELOPMENT  OF  FUND 

New  York  Fund  Operated  Independently  from  1894  to  1901 83 

Brooklyn  Fund  Operated  Independently  from  1895  to  1901 86 

Fund  Consolidated  in  1901  with  Increased  Benefits 86 

Organization  of  Fund  from  1905  to  1914 87 

Changes  in  Benefit  and  Income  Provisions — 1894  to  1914,  Inclusive 90 

Pensions  Increase  from  $12,633.34  in  1895  to  $1,183,397.08  in  1914 92 

Main  Causes  for  Rapid  Increase  in  Pension  Payments 92 

City  Contributed  80  Per  Cent,  of  Income  of  Fund 94 

Depletion  of  Fund  Begins  in  1910 96 

Present  Bankruptcy  Hastened  by  Payment  of  $160,000  of  Refunds  in  1915 96 

Teachers  Allowed  Leaves  of  Absence  with  Half -pay  in  Lieu  of  Retirement 96 

Pensions  Increased  to  4.15  Per  Cent,  of  Active  Payroll 96 

1,549  Retired  Teachers  Draw  Average  Pension  of  $784.53  at  Close  of  1914 96 

Average  Present  Age  of  Men  and  Women  Pensioners 97 

Average  Age  at  Retirement  for  "Service"  of  Men  and  Women  Pensioners 98 

Average  Age  at  Retirement  for  "Disability"  of  Men  and  Women  Pensioners 98 


CHAPTER  XI— UNSUCCESSFUL  REORGANIZATION  ATTEMPTS 

Recurrence  of  Past  Errors  Must  be  Avoided 100 

Increased  Benefits  Demanded  Despite  Knowledge  of  Insolvency 100 

Rejected  Plans  for  Temporary  Adjustment 104 

V 


APPENDIX  TO  PARTS  I  AND  II 

PAGE 

Table    1.  Employees  Subject  to  Retirement  Law,  May  31,  1915 109 

Table    2.  Men  Teachers — Active  Force  as  of  June  30,  1914,  Classified  by  Age  and 

Length  of  Service 110 

Table    3.  Women  Teachers — Active  Force  as  of  June  30,  1914,  Classified  by  Age  and 

Length  of  Service 110 

Table    4.  Salary  Schedules,  June,  1915 112 

Table    5.  Number  of  Teachers  Who  Withdrew  from  the  Active  Service  for  Various 

Causes  During  the  Years  1909  to  1914 113 

Table    6.  Detailed  Statement  of  Disbursements — 1894  to  1914 113 

Table    7.  Detailed  Statement  of  Receipts— 1894  to  1914 114 

Table    8.  Absence  Deductions,  Refunds  and  Net  Deductions — 1894  to  1914 115 

Table    9.  Receipts   and   Disbursements — 1894   to    1914 — Analyzed   by   Sources   of 

Income  and  Object  of  Expenditure 116 

Table  10.  Statement  of  Surpluses,  Deficits  and  Balances — 1894  to  1914 117 

Table  11.  Receipts  and  Disbursements  During  the  Year  1915 118 

Table  12.  Comparative  Growth  of  Active  Force  and  Pensioners  and  of  Salary  and 

Pension  Rolls— 1905  to  1914 120 

Table  13.  Pensioners  on  Pension  Roll  December  31,  1913,  and  December  31,  1914, 

Classified  According  to  Amounts  of  Annual  Pension 121 

Table  14.  Men  Teachers — Total  Number  of  Persons  on  the  Pension  Rolls  on  June  30, 

1914,  Classified  by  Present  Age  and  Cause  of  Retirement 121 

Table  15.  Women  Teachers — Total  Number  of  Persons  on  the  Pension  Rolls  on  June 

30,  1914,  Classified  by  Present  Age  and  Cause  of  Retirement 122 

Table  16.  Men  Teachers — Number  of  Pensioners  on  the  Rolls  on  June  30,  1914,  Who 
Were  Retired  for  Length  of  Service,  Classified  by  Age  at  Date  of  Retire- 
ment and  Length  of  Service  Prior  to  Retirement 122 

Table  17.  Women  Teachers — Ntmiber  of  Pensioners  on  the  Rolls  on  June  30,  1914, 
Who  Were  Retired  for  Length  of  Service,  Classified  by  Age  at  Date  of 
Retirement  and  Length  of  Service  Prior  to  Retirement 123 

Table  18.  Men  Teachers — Number  of  Pensioners  on  the  Rolls  on  June  30,  1914,  Who 
Were  Retired  for  Disability,  Classified  by  Age  at  Date  of  Retirement  and 
Length  of  Service 123 

Table  19.  Women  Teachers — Number  of  Pensioners  on  the  Rolls  on  June  30, 1914,Who 
Were  Retired  for  DisabiUty,  Classified  by  Age  at  Date  of  Retirement  and 
Length  of  Service 124 

Table  |20.  Comparative  Statement  of  Retirements  Made  on  Account  of  Disability  After 
Less  Than  Thirty  Years  of  Service  and  of  Service  Retirements  Made  After 
Thirty  or  More  Years  of  Service  During  the  Calendar  Years  1905  to  1914 
(Inclusive) 125 

Table  21.  Pensioners  on  Rolls  September  1,  1915,  Who  Were  Retired  for  Disability 

After  Less  Than  Thirty  Years  of  Service 126 

Table  22.  Retirements  on  the  Ground  of  Disability  After  Less  Than  Thirty  Years  of 
Service  and  Cancellations  on  Account  of  Death  and  Voluntary  Reassign- 
ment to  Duty 126 

Table  23.  Comparative  Statement  of  Pensioners  and  Total  Pension  Charge  for  the 

Years  1913  and  1914 127 

Table  24.  Aggregate  and  Detailed  Annual  Cost  of  Pensions  to  Persons  Now  on  the 

Pension  Rolls  of  the  Teachers'  Retirement  Fund 128 

Details  of  Actual  and  Estimated  Service  Records  of  Teachers  Used  in  the 
Application  of  Proposed  Provisions 129 


VI 


PART  III— BASIS  OF  ACTUARIAL  CALCULATIONS 

CHAPTER  XII— INVESTIGATION  OF  ASSETS  AND  LIABILITIES  OF 

PRESENT  FUND  page 

Benefits  and  Contributions 137 

Data  Used  as  Basis  for  Valuations 138 

Mechanical  Tabulations 143 

Table  25.  Actual  Experience — Active  Service 143 

Table  26.  Actual  Experience — Service  Pensioners 144 

Table  27.  Actual  Experience — Disability  Pensioners 144 

Table  28.  Actual  Experience — Salary  Scale 145 

Exposure  and  Check  Tables 145 

Table  29.  Comparison  of  the  Number  of  Separations  of  Men  Teachers  from  the 
Service  Which  Were  Recorded  by  the  Pension  Commission  with  the 
Number  Which  Wotild  Have  Occurred  Had  the  Rates  of  Separation 

Been  the  Same  as  Those  Prepared  in  the  Former  Investigation 145 

Table  30.  Comparison  of  the  Number  of  Deaths  Among  Men  Pensioners 
Recorded  by  the  Pension  Comjnission  with  the  Deaths  That  Would 
Have  Occurred  Had  the  Rates  of  Mortality  Been  the  Same  as  Those 

Shown  in  the  Previous  Investigation 146 

Table  31.  Comparison  of  the  Nimiber  of  Separations  of  Women  Teachers  from 
the  Service  Which  Were  Recorded  by  the  Pension  Commission,  With 
the  Number  Which  Would  Have  Occurred  Had  the  Rates  of  Separa- 
tion Been  the  Same  as  Those  Prepared  in  the  Former  Investigation . .  147 
Table  32.  Comparison  of  the  Number  of  Deaths  Among  Women  Pensioners  Re- 
corded by  the  Pension  Commission  With  the  Deaths  That  Would 
Have  Occurred  Had  the  Rates  of  Mortality  Been  the  Same  as  Shown 

in  the  Previous  Investigation 147 

Graduation  of  Unadjusted  Rates 151 

Rates  and  Comparisons 151 

Table  33.  Comparative  Rates  of  Withdrawal  from  Active  Service 152 

Table  34.  Comparative  Rates  of  Mortality  in  Active  Service 153 

Table  35.  Comparative  Rates  of  Disability  in  Active  Service 154 

Table  36.  Rates  of  Service  Retirement  from  Active  Service 164 

Table  37.  Rates  of  Mortality  Among  Pensioners 155 

Service  and  Mortality  Tables 155 

Table  38.  Active  Service  Table  and  Salary  Scale — Men 157 

Table  39.  Active  Service  Table  and  Salary  Scale — ^Women 168 

Table  40.  Service  Pensioners'  MortaUty  Table — Men 159 

Table  41.  Service  Pensioners'  Mortality  Table — ^Women 159 

Table  42.  Disability  Pensioners'  Mortality  Table — Men 160 

Table  43.  Disability  Pensioners'  Mortality  Table — Women 161 

Rate  of  Interest 161 

Present  Value  of  Various  Benefits 162 

Table  44.  Amount  of  Money  Which,  if  Placed  at  4  Per  Cent.  Compound 
Interest  at  the  Time  the  Employee  Enters  the  Service,  WiU  Be  Suffi- 
cient to  Provide  for  His  Pension  Payments  Under  the  Various  Benefits 
for  Which  He  May  Become  Eligible.  Computed  on  the  Basis  of  An 
Average  Entrance  Salary  of  $1,134  per  Annum  for  Men  and  $762  per 

Aimum  for  Women 162 

Table  45.  Amount  of  Money  Which,  Placed  at  4  Per  Cent.  Compound  Inter- 
est at  the  Time  the  Employee  Enters  the  Service,  Will  Be  Sufficient  to 
Provide  for  His  Pension  Payments  Under  the  Various  Benefits  for 
Which  He  May  Become  Eligible.  Computed  on  the  Basis  of  an 
Entrance  Salary  of  $1,000  per  Annum  for  Both  Men  and  Women . . .    163 

vii 


PAGE 

Present  Active  Service  and  Pension  Rolls 163 

Table  46.  Number  and  Salary  of  All  Regular  Teachers  in  the  Active  Service 

Classified  by  Age 164 

Table  47.  Number  and  Salary  of  All  Hunter  College  Teachers  in  the  Active  Service 

Classified  by  Age 164 

Table  48.  Number  and  Salary  of  All  Regular  Teachers  in  the  Active  Service 

Classified  by  Length  of  Service 165 

Table  49.  Niunber  and  Salary  of  All  Hunter  College  Teachers  in  the  Active  Service 

Classified  by  Length  of  Service 165 

Table  60.  Number  and  Pension  of  All  Regular  Teacher  Pensioners  Who  Were 

Retired  on  Service  Pensions  Classified  by  Age 166 

Table  51.  Number  and  Pension  of  All  Hunter  College  Pensioners  Who  Were 

Retired  on  Service  Pensions  Classified  by  Age 166 

Table  52.  Number  and  Pension  of  All  Regular  Teacher  Pensioners  Who  Were 

Retired  on  DisabiUty  Pensions  Classified  by  Age 167 

Table  53.  Number  and  Pension  of  All  Hunter  College  Pensioners  Who  Were 

Retired  on  Disability  Pensions  Classified  by  Age 167 

Valuation  Balance  Sheets. 168 

Table  54.  Valuation  of  Assets  and  Liabilities  of  the  School  Teachers'  Retirement 

Ftmd  on  Account  of  Men  Teachers — Valued  as  of  June  30,  1914 ....  168 
Table  55.  Valuation  of  Assets  and  Liabilities  of  the  School  Teachers'  Retirement 

Fund  on  Account  of  Women  Teachers — ^Valued  as  of  June  30, 1914. .  160 
Table  56.  Valuation  of  the  Total  Assets  and  Liabilities  of  the  School  Teachers' 

Retirement  Fund — ^Valued  as  of  June  30,  1914 170 

Percentage  of  Salaries  Required  to  Pay  Pensions  to  Future  Entrants 170 

Table  57.  Rates  of  Contribution,  Expressed  as  Percentages  of  Salaries,  Necessary 

to  Pay  for  the  Various  Pension  Benefits  Allowed  by  the  Pension 

Provisions  of  the  Teachers'  Retirement  Fund 171 

CHAPTER  XIII— VALUATION  OF  FUND  UNDER  PROPOSED  PENSION 

PLAN 

Benefits  and  Contributions 172 

Tables  Used  as  Basis  for  Valuation  of  Proposed  Fund 172 

Table  58.  Adopted  Rates  of  Withdrawal  and  Disability  Used  in  Valuation  of 
Proposed  Fund  in  Place  of  Corresponding  Rates  Developed  from 

Experience  Under  Present  Fund 173 

Valuation  Balance  Sheet 174 

Table  59.  Valuation  of  the  Total  Assets  and  Liabilities  of  the  School  Teachers' 
Retirement  Fund  Under  the  Proposed  Pension  Law — Valued  as  of 

June  30,  1914 174 

Percentage  of  Salaries  Required  to  Pay  Pensions  to  Future  Entrants 174 

Table  60.  Contributions,  Expressed  as  a  Percentage  of  Salary  Paid,  Required  of 
Entrants  in  Order  That  They  May  Pay  Half  the  Cost  of  the  Pension 

Benefits  Allowed  to  Them 175 

Contributions  Required  from  Employees  Now  in  Service 175 

Table  61.  Total  Contributions,  Expressed  as  a  Percentage  of  Salary  Paid,  Reqxiired 
of  Employees,  in  Order  That  They  May  Pay  One -Half  the  Cost  of  the 
Pension  Benefits  Allowed  to  Them.     Rates  Given  According  to 

Present  Age  and  Length  of  Service — Rates  for  Men 176 

Table  62.  Total  Contributions,  Expressed  as  a  Percentage  of  Salary  Paid,  Re- 
quired of  Employees,  in  Order  That  They  May  Pay  One-Half  the 
Cost  of  the  Pension  Benefits  Allowed  to  Them.  Rates  Given  Ac- 
cording to  Present  Age  and  Length  of  Service — ^Rates  for  Women. .   177 

viii 


New  York,  December  8,  1915. 

To  THE  Commission  on  Pensions, 
City  of  New  York. 

Sirs: 

Since  in  1894  in  New  York,  and  since  1895  in  Brooklyn,  pension  systems 
have  been  in  operation  for  the  retirement  of  superannuated  teachers.  In 
1905  the  existing  teachers'  retirement  fund  was  organized.  It  is  now  in- 
solvent not  only  with  respect  to  its  future  obligations,  but  with  respect  to 
obligations  currently  maturing. 

In  the  following  report  there  is  outlined  a  history  of  the  teachers' 
pension  system  in  New  York  City.  Complete  facts  are  given  with  regard 
to  the  development  of  the  existing  fund,  its  present  condition,  together  with 
recommendations  for  establishing  an  equitable  and  financially  sound  per- 
manent retirement  system. 

The  imperative  need  for  reorganizing  the  teachers'  retirement  fund  of 
the  city  of  New  York  is  not  only  a  question  of  vital  concern  to  the  present 
and  future  teachers  in  the  service  of  the  city,  but  is  of  the  greatest  impor- 
tance to  the  welfare  of  the  schools.  It  was  long  ago  demonstrated  by  experi- 
ence that  an  efficient  teaching  force  could  not  be  recruited  or  maintained 
if  provision  were  not  made  for  the  suitable  retirement  of  teachers  when  by 
reason  of  age  or  other  disability  they  are  no  longer  fitted  for  active  teaching 
service. 

It  has  been  a  common  fault  of  retirement  or  pension  systems  that  they 
have  failed  to  give  heed  to  the  cost  of  putting  into  permanent  effect  benevo- 
lent programs.  It  is  easy  to  plan  generous  benefits,  but  less  easy  to  make 
financial  provision  for  them.  With  natural  human  optimism,  the  future 
cost  of  pension  plans  is  generally  discounted,  with  the  result  that  a  compara- 
tively brief  experience  in  applying  benefits  brings  about  an  inadequacy  of 
income  such  as  now  confronts  the  New  York  Teachers'  Retirement  Fund. 

There  are  many,  no  doubt,  who  will  argue  that  whatever  the  cost  of 
retirement,  a  great  city  should  make  provision  for  the  comfortable  release 
from  service  of  superannuated  employees.  But  there  are  limitations  to 
what  even  a  municipal  Corporation  can  do.  The  city  of  New  York  has  not 
only  to  concern  itself  with  its  20,000  teachers,  but  it  has  to  meet  obligations 
legally  incurred  for  the  retirement  of  lo^goo  policemen  and  5,000  firemen, 
and  to  assist  in  financing  funds  for  the  retirement  of  several  other  groups 
of  employees.  When  all  this  is  done  there  remains  unprovided  for  the 
great  bulk  of  city  employees,  whose  pensions  are  paid  out  of  the  public 
treasury  only  when  after  thirty  years  of  service  they  are  physically  or 
mentally  unfitted  to  perform  their  duties. 

It  would  be  easy  to  submit  for  the  consideration  of  authorities  and  tax- 
payers generous  pension  plans  which  place  the  entire  cost  upon  the  city.    It 


does  not  require  much  wisdom  to  appreciate  the  folly  of  such  a  course.  Not 
only  would  the  immediate  cost  be  burdensome,  but  it  would  presently  become 
so  onerous  that  unquestionably  benefits  would  be  curtailed. 

If  it  be  to  the  interest  of  the  city  that  provision  be  made  for  the  retire- 
ment of  superannuated  employees,  it  is  of  greater  interest  to  the  employees 
themselves  who  are  the  beneficiaries  of  the  retirement  plan.  But  merely 
from  self-interest,  and  without  regard  to  questions  of  propriety  and  justice, 
employees  should  welcome  any  means  which  will  ensure  the  permanency  of 
a  plan  established,  and  remove  from  the  possibility  of  doubt  their  receipt  of 
pensions  when  the  time  comes  for  them  to  claim  them. 

With  these  considerations  in  view  the  plan  suggested  in  this  report  for 
reorganizing  the  teachers'  retirement  fund  places  equally  upon  the  teachers 
and  the  city,  with  one  qualification  in  favor  of  the  teachers,  later  discussed, 
tEe  cost'of  future  benefits.  The  cost  of  these  future  pensions  will  be 
"considerable  if  they  are  to  be  as  adequate  as  they  should  be  from  the  stand- 
point of  efficiency  and  humanity. 

There  must  also  be  provided  the  means  of  meeting  future  payments  on 
pensions  already  granted,  which  for  191 5  will  total  about  $1,200,000,  decreas- 
ing each  year  thereafter.  In  order  that  the  members  of  the  existing  teach- 
ing force  may  no  longer  be  required  to  contribute  a  part  of  their  salaries 
to  meet  the  pensions  of  teachers  already  retired,  it  is  proposed  to  accumu- 
late all  future  contributions  by  teachers  for  the  payment  of  pensions  to 
those  who  contribute. 
\  Accordingly,  it  is  suggested  that  the  city  assume  responsibility   for 

liquidating  the  cost  of  pensions  already  granted  and  assist  in  meeting  the 
charge  upon  the  teachers  of  the  cost  of  their  share  of  future  pensions  when 
one-half  the  total  cost  will  be  too  burdensome. 

The  following  report  fully  explains  the  basis  of  these  recommenda- 
tions.   It  may  be  wise,  however,  to  give  a  word  of  explanation  at  this  point. 

The  proposed  plan  is  based  upon  a  comprehensive,  actuarial  determina- 
^  tion  of  the  actual  cost  of  providirig  pensions  for  the  teaching  service.  For 
teachers  to  be  employed  in  the  future,  this  cost  will  vary  with  age  at  the 
time  of  entrance  into  the  service,  and  will  require  equal  contributions  from 
.both  teachers  and  the  city  of  from  2.52  per  cent,  to  4.53  per  cent,  of  total  sal- 
aries. Similarly,  it  will  vary  for  the  individual  members  of  the  existing 
teaching  force  in  accordance  with  their  respective  ages  and  length  of  prior 
service  at  the  time  of  the  establishment  of  the  new  plan.  Where  teachers  are 
approaching  the  period  of  superannuation,  contributions  necessarily  will 
be  high,  in  order  that  a  sufficient  fund  may  be  set  aside  to  meet  the  obliga- 
tions as  they  mature.  When  the  one-half  of  the  total  cost  which  is  to  be 
assessed  on  the  teachers  exceeds  8  per  cent,  of  the  salary  of  the  teacher 
in  question,  it  is  proposed  that  the  city  make  up  the  difference.  Cases  where 
the  rate  will  reach  this  high  figure  are,  of  course,  relatively  few,  and  will 
consist  of  those  who,  advanced  in  years,  are  reaching  the  age  of  retirement. 

Often  it  is  claimed  that  to  lay  aside  a  fund  for  pension  purposes  on  an 
actuarial  basis  is  unnecessary,   since  the  pension   roll   may  be   regarded 


merely  as  a  retired  list,  and  quite  as  much  a  charge  upon  the  current  ^ 
revenues  of  the  city  as  are  the  salaries  of  active  employees.  This  view,  it/ 
is  believed,  is  shortsighted,  for  many  reasons,  and  conspicuously  for  the/ 
reason  that  when  it  becomes  inconvenient  financially  and  politically  tc^ 
increase  the  retired  list,  superannuated  teachers  will  not  be  retired,  injustic^ 
will  be  done  to  employees  no  longer  able  to  perform  their  duties  effectively] 
and  the  schools  will  be  injured  by  inefficient  service.  Because  of  the  bank-\ 
rupt  condition  of  the  teachers'  retirement  fund,  this  demoralized  condition 
exists  at  the  present  time  in  New  York  City.  Many  teachers  who  should 
be  retired  are  either  carried  on  half  pay  or  are  required  to  continue  in 
active  service. 

It  is  unjust  to  taxpayers  that  they  should  be  asked  in  any  one  year  to 
meet  the  obligations  for  service  rendered  in  the  past.  It  is  as  financially 
shortsighted  to  fail  to  set  aside  currently  the  cost  of  an  obligation  currently 
accruing  and  to  mature  at  some  future  date,  as  it  would  be  to  fail  to  amor- 
tize long  term  bonds  by  annual  installments  in  the  sinking  fund.  No  method 
other  than  annual  payments  on  an  actuarial  basis  can  be  advanced  for  cur- 
rently accruing  funds  to  meet  liabilities  as  they  accumulate. 

Throughout  Europe,  where  retirement  systems  are  recognized  as  an 
essential  part  of  employment  plans,  many  funds  have  been  established  on  an 
actuarial  basis  into  which  are  paid  currently  the  charges  accruing  against 
liabilities  maturing  in  the  future.  To  leave  the  provision  for  future  retire- 
ments to  the  uncertain  action  of  changing  appropriating  authorities  will  be 
to  keep  in  a  condition  of  confusion  and  uncertainty  the  plans  of  teachers 
who  are  growing  old  in  the  service,  and  keep  active  a  very  demoralizing 
influence  on  the  efficiency  of  the  service. 

In  this  report,  therefore,  following  good  practice  elsewhere,  and  guided 
by  the  past  mistakes  of  New  York  City  in  dealing  with  pension  problems,  a 
proposal  is  made  to  organize  a  retirement  system  which  will  be  free,  on  the 
one  hand,  of  uncertainties,  and,  on  the  other,  will  provide  a  means  just  to 
employees  and  taxpayers  alike  for  its  financing.  It  is  by  no  means  main- 
tained that  the  conclusions  set  forth  in  the  report  are  final.  They  are  pre- 
sented with  a  view  to  complete  discussion  and  with  the  expectation  that 
they  will  be  changed  in  the  light  of  fuller  wisdom  and  possibly  more  mature 
thought  which  this  discussion  will  produce.  Whatever  may  be  the  judg- 
ment on  the  recommendations,  the  facts  are  plainly  told  so  that  there  is 
provided  a  complete  basis  for  considering  the  two  major  questions  involved 
in  the  problem:  First,  what  shall  be  the  conditions  of  retirement?  Second, 
how  shall  the  cost  of  meeting  these  conditions  be  provided  ? 

It  is  conceivable,  of  course,  that  the  cost  of  the  entire  pension  plan  may 
be  levied  upon  the  teachers  themselves.  But  to  do  so  would  mean  either  to 
cut  down  the  benefits  below  a  point  where  they  would  seem  adequate  to 
furnish  a  proper  basis  of  retirement,  or  to  impose  an  intolerable  burden 
upon  the  teaching  force.  Similarly,  it  is  conceivable  that  the  entire  cost 
might  be  laid  upon  the  city.  But  if  this  were  done,  the  burden  on  taxpayers 
would  be  so  great  that  protest  would  be  surely  evoked,  and  either  reduction 


or  complete  stoppage  of  benefits  would  follow.  The  middle  course  of  equal 
division  of  cost  is  suggested  with  the  adequate  safeguard  of  the  interest  of 
the  teachers  that  in  case  they  withdraw  from  the  service  prior  to  retire- 
ment their  contributions  shall  be  returned  to  them  with  compound  interest. 
The  cost  of  the  provision  to  return  contributions  is  included  in  the  deter- 
mination of  the  rates  upon  which  the  plan  is  based. 

During  the  preliminary  discussions  of  the  recommendations  of  this 
report  criticism  has  been  made  by  teachers  of  the  provision  which  fixes  the 
age  of  superannuation  at  65  years.  It  is  claimed  that  a  teacher  is  unfit  for 
service  before  reaching  65  and  that  a  superannuation  provision  withholding 
retirement  for  service  until  that  age  would  be  of  little  value  to  the  teachers 
and  of  injury  to  the  schools.  A  provision  similar  to  the  one  in  the  present 
law  which  permits  retirement  after  30  years  of  service  is  urged,  but  the 
argument  seems  generally  to  be  in  the  direction  of  retirement  at  about  60 
years. 

The  difference  of  a  few  years  would  add  materially  to  the  cost.  Can 
the  greater  cost  be  endured  by  the  city  and  by  the  teachers  ?  Abroad,  super- 
annuation for  teachers  is  widely  fixed  at  65  years.  In  New  York,  men 
teachers  have  retired  at  an  average  age  of  66  years,  women  teachers  at  57. 
In  the  proix>sed  plan  a  teacher  who  is  disabled  for  any  cause  may  retire 
any  time  after  ten  years  of  service,  though  at  a  lower  rate  than  the  service 
pension.  It  would  not  be  necessary,  therefore,  because  of  the  65  super- 
annuation provision,  for  a  teacher  to  remain  in  service  after  becoming  phy- 
sically or  nervously  incapacitated.  It  might  be  possible  to  permit  voluntary 
retirement  at  60  with  a  lower  pension,  based  on  the  actuarial  value  of  the 
pension  at  that  age. 

Our  views  on  the  subject  are  not  iron  clad.  Many  sound  alternatives 
for  each  feature  of  the  suggested  plan  may  be  advanced  as  advisable  of 
adoption.  They  have  not  been  presented  in  this  report  as  the  calculation  of 
the  variations  in  cost  would  have  greatly  delayed  its  publication  and  the 
subject  matter  would  have  become  too  complicated.  It  would  seem  desir- 
able, therefore,  to  await  a  crystallization  of  thought  on  the  part  of  the 
teachers,  the  city  and  the  public  before  the  final  and  complete  revision  of 
the  suggested  scheme,  including  cost  calculations,  are  undertaken.  If  the 
greater  cost  of  the  earlier  retirement  age  seems  to  be  offset  by  its  advantage 
to  the  schools,  the  recommendations  herein  made  can  be  modified  accord- 
ingly. The  commission  will  gladly  confer  with  representative  teachers' 
organizations  regarding  the  cost  of  desired  pensions. 

I  wish  to  add  a  word  regarding  the  frequently  appearing  misconcep- 
tions of  the  purpose  of  actuarial  computations.  To  many  the  word  "ac- 
tuarial'^ seems  to  imply  a  ruthless  disregard  of  humanitarian  rights.  It  is, 
of  course,  merely  a  precise  calculation  of  what  is  to  be  the  future  cost  of 
a  proposed  benefit.  Not  to  determine  this  cost  would  be  to  launch  the  city 
and  its  employees  on  a  speculative  program  of  pensions  without  any  as- 
surance that  future  benefits  would  be  paid  when  the  amount  of  annual 


outlay  became  burdensome.  It  is  imperative,  of  course,  that  human  con- 
siderations be  taken  into  account  in  determining  a  pension  plan,  but  it  is 
the  most  short-sighted  sentimentalism  to  disregard  the  fundamental  facts 
of  cost  and  income  in  reaching  conclusions  as  to  a  pension  policy.  A  proper 
pension  plan  involves  a  contractual  relation  between  employer  and  em- 
ployees. A  clear  agreement  as  to  this  relation  cannot  be  arrived  at  unless 
it  is  based  upon  facts.  It  is  to  ascertain  the  facts  that  actuarial  computations 
are  necessary.  Only  by  such  computation  will  it  be  possible  to  avoid  the 
tragic  disaster  into  which  pension  plans  have  been  plunged,  as  now  in  New 
York,  and  other  cities  in  the  United  States  and  abroad. 

The  descriptive  and  constructive  suggestions  contained  in  the  report 
have  been  worked  out  by  the  staff  of  the  commission  under  the  immediate 
direction  of  Mr.  Robert  von  Reutlinger.  The  actuarial  work  was  performed 
by  the  Commission's  actuary,  Mr.  George  R>.Buck,  with  the  advice  of  a 
consulting  volunteer  board  of  actuaries.  This  board,  which  was  nominated 
at  the  request  of  the  Commission  by  the  Actuarial  Society  of  America,  con- 
sists of  the  following  gentlemen : 

Wm.  A.  Hutcheson,  Actuary,  Mutual  Life  Insurance  Company — Chairman 
Robert  Henderson,  Actuary,  Equitable  Life  Assurance  Society 
Henry  Moir,  Actuary,  Home  Life  Insurance  Company 

To  them  I  desire  to  acknowledge  our  great  indebtedness  not  only  with 
respect  to  this  report,  but  for  their  continuous  advice  in  all  the  work  of  the 
commission  which  has  to  do  with  eight  other  pension  funds  and  the  work- 
ing out  of  a  pension  plan  for  the  entire  municipal  service. 

Respectfully  submitted, 

HENRY   BRUERE, 
Vice-Chairman  and  Secretary. 

Mr.  George  W.  Perkins,  Chairman. 

Frank  H.  Bethell  Frank  L.  Dowling 

John  A.  Bolles  August  Ferrand  , 

Raynal  C.  Boiling  Joseph  Haag 

John  H.  Boschen  Louis  H.  Hahlo 

William  H.  Chorosh  Francis  D.  Pollak 

Mrs.  F.  H.  Cothren  Arthur  Williams 

Albert  de  Roode  S.  Herbert  Wolfe 


PART  I 

INTERPRETATIVE    AND    CONSTRUCTIVE 
REPORT 


CHAPTER  I 

INTRODUCTION 

Advance  Consideration  of  Teachers'  Fund  Necessitated  by  Its  Bank- 
ruptcy 

The  consideration  of  the  teachers'  retirement  fund  in  advance  of  the 
general  pension  problem  of  the  city  is  necessitated  by  its  critical  financial 
condition.  The  fund's  resources  are  exhausted,  temporary  relief  measures 
have  failed  of  adoption,  and  it  appears  that  a  reorganization  can  be  effected 
only  if  a  permanent  plan  is  submitted. 

The  disadvantages  of  arriving  at  a  final  solution  with  regard  to  the 
teachers'  fund  at  the  present  time  are  twofold.  In  the  first  place,  a  con- 
sistent retirement  policy,  giving  equal  consideration  under  like  conditions 
to  all  city  employees,  can  best  be  developed  after  facts  relating  to  the  entire 
municipal  service  have  been  presented  and  discussed  according  to  their 
relative  value  and  significance.  Secondly,  definite  recommendations  for 
support  by  the  city  are  difficult  before  calculations  of  the  cost  of  all  existing 
and  tentatively  proposed  new  pension  provisions  have  been  completed. 

The  constructive  recommendations,  included  in  this  report,  are,  there- 
fore, tentative  and  subject  to  modification  in  the  light  of  future  discussion 
and  presentation  of  facts  regarding  other  branches  of  the  service.  They 
are  submitted  for  purposes  of  discussion  and  are  distinctly  subject  to 
change. 

Exhaustive  Inquiry  as  Foundation  for  Conclusions  Reached 

To  arrive  at  definite  conclusions  regarding  the  effect  of  existing  pro- 
visions of  the  teachers'  retirement  fund  on  the  teaching  service,  it  was 
necessary  to  subject  the  past  operation  of  the  fund  to  a  close  scrutiny. 
For  this  purpose  a  study  was  made  of  the  development  of  legislative  action, 
of  administrative  measures  adopted  for  the  interpretation  of  the  law,  of 
the  application  of  provisions  in  individual  cases  and  of  the  financial  trans- 
actions of  the  fund.  The  results  of  this  study  which  represent  the  fact 
basis  of  conclusions  reached  are  presented  in  Part  II  of  this  report. 

In  order  to  enable  the  commission  to  calculate  the  cost  of  existing 
benefit  provisions  and  those  to  be  proposed,  a  sound  basis  for  actuarial 
computations  was  required.  An  experience  of  six  years — June  30,  1908 
to  June  30,  1914 — was  selected  for  this  purpose.  Essential  data  for  each 
teacher  who  drew  a  salary  or  pension  during  this  period  was  secured  by 
means  of  25,000  individual  schedules  filled  mostly  by  teachers  themselves 
or  obtained  by  the  staff  of  the  commission  from  departmental  records. 
This  data  formed  the  foundation  of  the  actuarial  work,  the  details  of 
which,  showing  the  methods  employed  in  computations,  form  the  subject 
matter  of  Part  III  of  this  report. 


Present  Plan  Defective 

The  present  inquiry  into  the  operation  of  the  teachers'  retirement  fund 
has  brought  out  the  fact  that  it  does  not  fully  accomplish  its  main  purpose, 
namely,  assisting  in  the  maintenance  of  a  high  standard  of  efficiency  in  the 
teaching  service.  The  principal  defects  in  the  operation  of  the  present 
retirement  fund  leading  to  this  conclusion  are  the  following: 

1.  The  operation  of  the  30  years'  service  provision  of  the  plan 
permitting  retirement  without  proof  of  incapacity  early  in  life. 

2.  Retirement  because  of  physical  or  mental  disability  after  a 
short  period  of  service  based  mainly  upon  the  certificate  of  private 
physicians  employed  by  the  applicant. 

3.  The  scale  of  benefits  is  high  and  does  not  provide  more  pen- 
sion for  more  service. 

4.  The  interpretation  of  the  retirement  law,  which  allows  a  wide 
scope  of  administrative  discretion,  devolves  upon  a  large  number  of 
officials  and  is,  comparatively,  an  unimportant  part  of  their  duties. 

In  addition  to  the  plan's  failure  to  promote  adequately  the  efficiency 
of  the  service,  it  has  been  conducted  without  knowledge  of  its  cost.  As 
a  result,  the  income  provided  by  law  to  finance  the  fund's  requirements  has 
fallen  below  its  annual  demands. 

The  appraisement  of  assets  and  liabilities  of  the  fund  as  of  June  30, 
1914,  under  the  assumption  that  it  will  continue  to  operate  under  the  present 
benefit  provisions,  has  brought  out  the  following  facts : 

1.  Present  fund  methods  would  require  income  increasing  to  20  per  cent. 

of  payroll: 

The  annual  pension  roll,  which  at  present  is  4.15  per  cent,  of 
the  payroll,  will  in  the  course  of  the  next  35  years  increase  to  20 
per  cent,  of  the  payroll,  provided  the  present  salaries  and  quota  of 
the  teaching  force  are  not  increased.  The  fund's  annual  income, 
limited  by  law,  is  at  present  about  4  per  cent,  of  the  payroll,  i  per  cent, 
of  which  is  contributed  by  teachers,  and  shows  a  tendency  to  yield  a 
lesser  percentage  in  the  future.  The  continuation  of  the  plan  would, 
therefore,  necessitate  legal  provision  for  the  gradual  increase  of  the 
contributions  of  the  teachers,  or  the  city,  or  both,  until  the  combined 
income  would  amount  to  20  per  cent,  of  the  payroll. 

2.  Fund's  liabilities,  $69,809,760: 

The  discounted  value,  at  4  per  cent,  compound  interest,  of  future 
payments  for  pensions  already  granted  and  those  to  be  granted  to 
prospective  beneficiaries  of  the  present  force  is  $69,809,760. 

3.  Fund's  assets,  $15,066,440: 

The  fund  has  $882,715  on  hand  (June  30,  1914).  The  discounted 
value  of   future  contributions  of  present  teachers  is  $4,183,725   and 

10 


contributions  of  the  city  on  their  behalf  is  $10,000,000,  making  the 
total  future  assets  of  the  fund  $15,066,440. 

4.  Fund's  shortage,  $54,743,320: 

The  net  deficiency  of  the  fund  is  $54,743,320,  or  nearly  twice  the 
total  annual  payroll  of  the  Department  of  Education.  If  the  fund, 
in  addition  to  its  future  income  as  provided  by  law,  had  this  amount 
on  hand  on  June  30,  19 14,  it  would  have  been  enabled,  with  future 
accumulations  of  4  per  cent,  compound  interest,  to  meet  all  pension 
claims  of  pensioners  and  teachers  on  the  rolls  on  that  date. 

5.  Deficiency  rapidly  increasing  since  June  30,  1914: 

The  lack  of  compound  interest  accumulations  since  June  30,  1914, 
on  the  unprovided  reserve  of  $54,743,320  and  the  inadequacy  of  the 
fund's  income  on  account  of  teachers  employed  since  that  date  rapidly 
increase  the  deficiency.  Annual  payments  to  the  fund  of  about  6f  per 
cent,  of  the  salaries  of  such  entrants  (about  4  per  cent,  in  case  of  men 
and  about  7  per  cent,  in  case  of  women)  are  required  to  cover  the 
future  cost  of  their  pensions  under  present  provisions. 

Tentatively  Suggested  Reorganization  Plan 

As  a  first  step  toward  a  permanent  reorganization  of  the  fund,  a  ten- 
tative plan  has  been  formulated  and  its  cost  calculated.  The  details  of  the 
suggested  plan  are  discussed  elsewhere  in  this  report.  In  order  to  facih- 
tate  a  perspective  of  what  is  involved  in  the  fund's  reorganization,  the  main 
features  of  present  provisions  and  of  those  tentatively  suggested  as  a  basis 
for  discussion  are  presented  in  condensed  form  in  the  comparative  state- 
ment on  pages  12  to  14. 

In  brief,  the  recommendations  for  the  future  financing  of  fund  require- 
ments are  as  follows : 

1.  That  the  teachers'  contributions  be  accumulated  at  interest  of 
4  per  cent,  and  used  only  as  the  obligations  for  which  they  were 
paid  mature.  These  contributions  would  amount  during  the  first  year 
to  $1,529,700,  or  about  5^4  P^r  cent,  of  the  payroll  and  gradually 
decrease  to  a  constant  3  per  cent,  of  the  payroll  in  the  course  of  the 
next  47  years,  at  the  end  of  which  period  all  present  teachers  who  are 
to  pay  the  higher  rates  will  have  left  the  service. 

2.  Two  alternatives  are  suggested  for  financing  the  city's  part 
of  the  pension  cost : 

(a)  The  thoroughly  sound  method  of  permanent  "normal" 
city  contributions  of  3  per  cent,  of  the  annual  payroll  ($866,710 
during  the  first  year)  for  the  accumulation  at  interest  of  the 
city's  half  of  the  pension  charge  accruing  because  of  services  of 
teachers  after  reorganization,  and  of  60  equal  annual  "deficiency" 
contributions  of  $1,233,220  for  the  amortization  of  the  deficiency 

11 


developed  in  the  past  which  is  not  covered  by  the  increased  scale 
of  contributions  recommended  for  teachers  now  in  service.  The 
total  annual  city  contributions  under  this  alternative  would  amount 
during  the  first  year  to  $2,099,930,  or  about  7^  per  cent,  of  the 
payroll,  gradually  decreasing  as  a  percentage  until  at  the  end  of 
the  60-year  period  they  would  amount  to  a  constant  3  per  cent, 
of  the  payroll. 

(b)  The  compromise  method  of  meeting  the  city's  part  of 
the  cost  as  tliat  cost  matures.  The  city's  contributions  under  this 
method  would  amount  during  the  first  year  to  about  $1,100,000, 
or  approximately  4  per  cent,  of  the  total  payroll.  They  would  not 
be  accumulated  at  interest,  but  be  required  to  meet  in  full  matur- 
ing pension  claims  of  pensioners  now  on  the  rolls,  and  of  that 
part  of  the  maturing  claims  of  pensioners  to  be  retired  in  the 
future  which  was  not  provided  for  by  the  accumulation  of  their 
own  contributions  at  4  per  cent,  interest.  The  city's  contribu- 
tions under  the  second  alternative,  therefore,  would  gradually 
increase  from  the  initial  contribution  of  4  per  cent,  to  a  higher 
percentage  of  the  payroll. 

A  full  discussion  of  this  financial  aspect  of  the  proposed  reorganization 
occurs  on  pages  65  to  70. 


COMPARATIVE  STATEMENT  OF  PROVISIONS  NOW  IN  FORCE 
I  AND  THOSE  TENTATIVELY  RECOMMENDED 


Provisions 

Under  the  Present  Law 

Under  Suggested 
Reorganization  Scheme 

1.    Administration 

Recommendation   for   re- 
tirement. 

Board  of  Retirement,  con- 
sisting of  7  members  (Pres. 
of  Bd.  of  Ed.,  2  members 
of  Bd.  of  Ed.,  the  City 
Supt.  and  3  members  of 
the  teaching  force). 

Board  of  Retirement  as  at 
present,  with  sUghtly 
changed  membership. 

Granting  of  pensions. 

Board  of  Education. 

City  Pension  Board. 

Medical   examination   for 
disability  retirement. 

By  applicant's  physician. 

By  physicians  of  City  Pen- 
sion Board. 

Medical    examination    of 
disability  pensioners. 

None  made. 

Annually,  by  physicians  of 
City  Pension  Board. 

Records,  teachers  in  active 
service. 

At  Dept.  of  Education,  not 
adapted  for  use  in  actua- 
rial valuations. 

At  City  Pension  Board, 
changed  to  show  data  re- 
quired for  valuations. 

12 


Provisions 

Under  the  Present  Law 

Under  Suggested 
Reorganization  Scheme 

Records,  pensioners. 

At  Dept.  of  Education,  not 
adapted  for  use  in  actua- 
rial valuations.  Duplicate 
set  kept  by   secretary  of 
Board  of  Retirement. 

At  City  Pension  Board, 
changed  to  show  data  re- 
quired for  valuations. 

Periodical  actuarial  valua- 
tions. 

None  made. 

By  actuary  of  City  Pension 
Board. 

2.    Benefits     . 

Superannuation  retirement. 

No  provision. 

At  age  65,  compulsory  by 
law,  unless  by  medical  ex- 
amination of  physician  of 
City  Pension  Board  abil- 
ity to  continue  is  proven. 

Compulsory    superannua- 
tion retirement. 

At  age  65,  after  30  years' 
teaching    experience,    no 
minimum  service  require- 
ment in  local  schools — 
discretionary  with  Board 
of  Education. 

At  age  70,  mandatory  by 
law. 

Service    retirement,  re- 
gardless of  age  and  in- 
capacity. 

After  30  years'  teaching  ex- 
perience,    minimum     15 
years'  local  service. 

None. 

Disability  retirement. 

After  20  years'  teaching  ex- 
perience,    minimum     15 
years'  local  service. 

After  10  years'  *  service. 

Basis  of  pension  scale. 

Salary  at  date  of  retirement. 

Average  salary  of  last  10 
years. 

Scale    of    superannuation 
pensions. 

One-half  salary  at  date  of 
retirement. 

lJi%  of  average  of  last  10 
years'  salary  for  each  year 
of  service. 

Scale  of  disability  pensions. 

One-sixtieth  of  final  salary 
for  each  year  of  service, 
including  years  serv'^ed  in 
schools    outside    of    the 
City  of  New  York. 

1%  of  average  of  last  10 
years'  salary  for  each  year 
of  service. 

Minimum  pension. 

$600  per  annum  after  30 
years'  service. 

30%  of  average  salary  of  last 
10  years.     Ui^omJLJ.  *^ 

Maximum  pension. 

$1,500  for  teachers  and  prin- 
cipals, $2,000  for  super- 
vising officials. 

No  maximum. 

Return    of    teachers'    con- 
tributions. 

At  dismissal;    without  in- 
terest. 

At  resignation,  dismissal  or 
death,  with  compound  in- 
terest at  4%. 

-HI 


un 


lUt-yV 


*  The  preliminary  plan  provided  for  disability  retirement  after  any  period  of  service.  Sub- 
sequently the  minimum  lo-year  service  limitation  was  added  as  a  proper  safeguard  to  the  fund.  To 
avoid  delay  in  the  publication  of  this  report,  no  change  in  the  original  cost  calculations  has  been 
made.  Tlie  necessary  slight  adjustments  in  rates  will  be  made  when  the  cost  of  the  final  plan  is 
calculated  in  all  its  details. 


13 


Provisions 


Special      concessions      to 
Hunter  College  staff. 


3.    Contributions 

By  teachers  now  in  active 
service,  for  pensions  ac- 
cruing because  of  past 
services  and  because  of 
services  to  be  rendered 
in  the  future. 


By  teachers  entering  ser- 
vice after  reorganization. 


By  city,  for  pensions  ac- 
cruing because  of  future 
services  of  teachers  now 
in  active  service  and 
teachers  entering  service 
after  reorganization. 


By  city,  for  present  pen- 
sioners and  for  the  dis- 
charge of  deficiency  aris- 
ing because  of  insuffii- 
cient  contributions  in 
the  past  on  account  of 
services  of  present  teach- 
ers prior  to  reorganiza- 
tion. 


Under  the  Present  Law 


No  minimum  service  in 
local  schools  for  service 
retirement;  10  instead  of 
15  years'  minimum  ser- 
vice in  local  schools  for 
retirement  on  disability; 
no  maximum  limitation 
of  amount  of  pension. 


1%  of  salaries,  not  exceed- 
ing annually  $30  for 
teachers  and  principals 
and  $40  for  supervising 
officials. 


Under  Suggested 
Reorganization  Scheme 


Same  provisions  as  for  all 
school  teachers. 


Graduated  scale  according  to 
present  age  and  length  of 
service,  including  ' '  out- 
side" experience,  prior  to 
reorganization;  rising  from 
a  minimum  of  2.63%  and 
2.87%  of  salaries  of  men 
and  women,  respectively, 
to  a  maximum  of  8%  of 
salaries. 


Unrefunded  absence  deduc- 
tions and  5%  of  excise 
tax,  yielding  insufficient 
income  to  permit  contin- 
uation of  present  scheme. 


Graduated  scale  according  to 
age  at  entrance  into  the  ser- 
vice; rising  from  a  mini- 
mum of  2.52%  to  a  maxi- 
mum of  3.13%  of  salaries 
at  age  40  in  the  case  of 
men,  and  from  a  minimum 
of  2.76%  to  a  maximum  of 
4.53%  of  salaries  at  age  40 
in  the  case  of  women. 

Back  contributions  for  teach- 
ers with  "outside"  ex- 
perience. 


Annual  appropriation  of 
about  3%  of  all  salaries  of 
present  teachers  as  well  as 
of  new  entrants.  The 
amount  of  the  appropria- 
tion during  the  first  year 
is  estimated  at  $866,710. 


Uniform  annual  deficiency 
appropriation  of  $1,233,- 
220  for  the  next  60  years, 
at  the  end  of  which  period 
the  present  deficiency  of 
$27,899,430,  as  set  forth 
in  the  balance  sheet  on 
page  15  will  be  wiped  out. 


14 


FINANCIAL    STATEMENT 
BALANCE    SHEET  AS   OF  JUNE   30,  1914 


TT  ^     fVi  Under 

Liabilities  and  Assets                                                        unaertne  Suggested 

as  of  June  30,  1914                                                              La^"  Reorganiza- 

^  tion  Scheme 

Liabilities 

Pensions  to  existing  pensioners: 

Value  of  1,521  pensions  at  $1,185,890  per  annum $11,581,210  $11,581,210 

Pensions  and    refund    benefits    to    prospective  beneficiaries 
of  the  present  force: 

Value  of  prospective  pensions 58,228.550  48,227,475 

Value  of  refund  benefits 4,105,235 

Total $69,809,760  $63,913,920 


Assets 

Funds  in  hand _. $882,715  $882,715 

Value  of  1%  salary  contributions  of  present  force  drawing 

salaries  of  $28,890,370  per  annum 4,183,725  

Value  of  salary  contributions  of  present  force  according  to 

suggested  graduated  scale ....  22,108,950 

Value  of  annual  "normal"  appropriations  by  city  of  about  3% 

of  salaries  of  present  teachers  for   pensions  accruing  be- 

caue  of  future  services ....  13,022,825 

Value  of  uniform   "deficiency"   appropriations  by  city  of 

$1,233,220  annually  during  the  next  60  years  for  the  dis- 
charge of  the  deficiency  arising  because  of  insufficient 

contributions  in  the  past ....  27,899,430 

Value  of  proportion  of  future  city  contributions  of  unexcused 

absence  deductions  and  5%  excise  taxes  which  can  be 

credited  to  present  teachers 10,000,000  .... 

Deficiency,  unprovided  for 54,743,320  .... 

Total $69,809,760      $63,913,920 


15 


CHAPTER   II 
PRESENT  PENSION  PROVISIONS 

Pensions  Should  Promote  EfSciency  of  Service 

A  constantly  growing  number  of  municipal  pension  funds  in  this  coun- 
try, especially  those  established  twenty  or  more  years  ago,  are  meeting  with 
financial  difficulty.  This  has  resulted  in  a  tendency  to  focus  attention  on 
the  balancing  of  income  and  outgo  alone.  The  fact  that  the  purpose  of 
pension  funds  is  not  limited  to  the  payment  of  pensions,  but  that  such  funds 
should  be  the  means  of  increasing  efficiency  of  service  has  frequently  been 
lost  sight  of. 

Yet  it  is  a  defect  common  to  most  of  the  existing  plans  that  their 
benefit  provisions  often  produce  a  harmful  effect  on  the  service  and  do  not 
result  in  an  equitable  treatment  of  individual  beneficiaries.  It  is  obvious, 
therefore,  that  pension  schemes  need  first  of  all  to  be  revised  on  the  basis 
of  principles  of  service  efficiency  and  equity.  The  question  of  equalizing 
pensions  and  resources  is  a  mathematical  process  which  must  necessarily 
follow  after  the  main  problems  are  satisfactorily  settled.  This  applies  with 
special  force  to  the  New  York  Teachers'  Retirement  Fund,  Its  continua- 
tion with  its  present  inequitable  and  illogical  features  could  hardly  be  jus- 
tified, even  if  it  were  financially  sound  and  able  to  meet  all  demands,  and 
required  little  or  no  support  from  the  taxpayer. 

Retirement  Without  Regard  to  Incapacity  Unjustifiable 

The  main  provision  of  the  present  pension  plan  is  retirement  after 
thirty  years'  teaching  experience,  regardless  of  age  or  incapacity.  The 
present  departmental  regulations,  in  force  since  1879,  prescribe  the  age 
limits  of  18  to  50  years  for  entrance  into  the  service.  Teachers,  therefore, 
may  become  eligible  for  retirement  at  as  early  an,  age  as  48.  Compulsory 
retirement,  under  departmental  rules,  takes  place  at  age  70.  It  is  obvious 
that  the  retirement  of  a  teacher  48  years  old  in  the  majority  of  instances 
means  a  loss  to  the  service  of  an  experienced  teacher,  while  the  retention 
in  the  service  of  a  teacher  until  the  advanced  age  of  70  may  be  equally  dis- 
advantageous. 

It  would  appear  that  in  a  department  with  a  wide  range  between  the 
minimum  and  maximum  age  limitations  for  entrance  into  the  service  the 
requirement  of  a  stated  uniform  number  of  years  of  service  before  retire- 
ment is  impractical  as  a  means  of  humanely  eliminating  teachers  who  have 
passed  the  period  of  usefulness. 

Half-pay  Pensions  Regardless  of  Length  of  Service  Inequitable 

Teachers  retiring  after  thirty  years  of  service  are  pensioned  at  half 
the  salary  received  at  the  date  of  retirement.    Additional  service  after  the 

16 


lapse  of  thirty  years  results  only  in  additional  contributions  without  increase 
in  pension  returns.  The  longer  a  teacher  remains  in  service  after  thirty 
years  the  more  he  contributes  and  the  less  he  draws  in  aggregate  pension 
receipts.  An  incentive  is  thereby  created  for  a  teacher  to  leave  the  service 
at  the  earliest  opportunity.  Assuming  that  a  pension  of  one-half  final  salary 
is  granted  after  thirty  years  of  service  to  a  teacher  48  years  old  and  after 
fifty-two  years  of  service  to  one  who  is  70  years  old,  the  former  has  the 
advantage  not  only  of  receiving  more  pension  payments,  but  also  of  having 
the  likelihood  of  adding  to  his  income  through  private  employment. 

Pensions  Based  on  Final  Salary  Inequitable 

The  present  determination  of  the  amount  of  pension  according  to  the 
salary  received  by  a  teacher  at  the  date  of  retirement  is  unsatisfactory.  A 
teacher  may  retire  immediately  following  an  increase  in  salary  and  obtain 
an  allowance  for  the  rest  of  her  life  on  the  basis  of  a  salary  rate  received 
for  only  a  short  time. 

A  general  increase  in  salary  rates  automatically  increases  the  liabili- 
ties of  the  fund  without  an  adequate  increase  in  its  income.  The  effect 
of  the  introduction  of  the  "equal  pay"  law  in  1912  may  serve  as  a  good 
illustration  of  this  fact.  As  shown  in  Table  20,  page  125,  in  191 1  only 
89  pensions  were  granted,  at  an  average  amount  of  $719.69,  while  in 
1912,  222  pensioners  were  placed  on  the  roll,  at  an  average  pension  of 
$887.07.  The  average  pension  granted  in  1913  and  1914  rose  to  $889.02 
and  $948.38  respectively.  While  pensions  in  the  past  three  years  were 
granted  on  the  basis  of  the  1912  salary  increases,  the  teachers'  contribu- 
tions were  made  prior  to  such  increases  from  the  lower  salaries  prevailing 
before  the  passage  of  the  "equal  pay"  law. 

Uncontrolled  Disability  Retirements  Result  in  Unwarranted  Expense 

The  existing  provisions  for  retirement  on  the  ground  of  disability 
present  one  of  the  most  unsatisfactory  features  of  the  pension  plan.  A 
teacher  who  has  had  at  least  twenty  years'  teaching  experience,  fifteen  of 
which  must  have  been  in  the  schools  of  New  York  City,  and  who  is  "men- 
tally or  physically  incapacitated  for  the  performance  of  duty"  may  be 
retired  on  a  pension  of  1/60  of  the  final  salary  for  each  year  of  service. 

The  following  observations  with  regard  to  the  existing  practice  are 
pertinent : 

1.  The  law  does  not  provide  a  satisfactory  definition  of  what  consti- 
tutes disability. 

2.  Proof  of  disability  is  furnished  in  the  form  of  a  certificate  of  the 
applicant's  private  physician. 

3.  Not  only  are  extensive  leaves  of  absence  included  in  the  number 
of  years  of  active  service  in  determining  eligibility  for  retirement,  but  in 
calculating  the  amount  of  pension  to  be  granted,  1/60  of  the  final  salary 
is  allowed  for  each  year  of  absence  during  which  no  service  was  rendered. 

17 


When  such  absence  was  without  pay,  the  teachers  were  not  contributing  to 
the  fund  during  its  duration. 

This  practice  is  the  result  of  a  ruling  of  the  Committee  on  By-laws  of 
the  Board  of  Education,  which  provides  that: 

"All  persons  who  are  in  the  school  system  are  entitled  to  retire 
for  the  aggregate  number  of  years  of  service,  including  any  time  dur- 
ing which  they  are  absent  on  leave." 

In  a  number  of  cases  absence  of  from  two  years  to  six  years  and  four 
months  were  credited  as  active  service  in  determining  the  amount  of  pension 
to  be  granted,  as  may  be  seen  from  the  following  specific  instances  up  to 
February  i,  1910: 


Retirement  Number  of 
Pensioner 


Actual 
Service 


Continuous  Ab- 
sence Preceding 
Retirement 


Service 
Credited  for 
Retirement 


1,342 18  yrs., 


891 
933 


1,199 18 

905 

949 

896 

942 

926 


18  yrs.,  3  mos. 

2 

TTS. 

,  -  mos.     20 

yrs. 

3  mos 

27 

'  10  " 

2 

4 

30 

2  " 

17 

'   8  " 

2 

6 

20 

2  " 

18 

'   2  " 

2 

7 

20 

9  " 

26 

<      J    u 

3 

2 

29 

3  " 

17 

'   8  " 

3 

3 

20 

11  " 

26 

'   5  " 

3 

4 

29 

9  " 

19 

'   6  " 

4 

4 

23 

10  " 

18 

'   7  " 

6 

4 

24 

11  " 

4.  Pensions  granted  for  disability  after  less  than  thirty  years  of 
service,  although  smaller  in  amount  than  pensions  granted  after  thirty  or 
more  years  of  service,  cost,  comparatively,  more  because  of  the  fewer  con- 
tributions made  to  the  fund  and  the  greater  number  of  payments  drawn 
on  account  of  the  longevity  of  pensioners  retiring  early  in  life. 

5.  The  Board  of  Education  has  not  taken  any  steps  to  compel  the 
return  to  duty  of  pensioners  whose  health  has  been  restored.  The  law 
allows  the  reinstatement  of  pensioners  to  active  service,  but  such  reinstate- 
ment is  voluntary  on  the  part  of  the  retired  teacher.  Six  of  the  total 
number  of  346  teachers  retired  since  1905  on  the  ground  of  disability  after 
less  than  thirty  years'  service  have  been  reassigned  to  duty,  but  on  their 
own  application. 

It  is  quite  probable  that  a  number  of  disability  pensioners  now 
on  the  roll  have  regained  their  health,  but  unless  they  voluntarily  apply 
for  reinstatement  or  the  Board  of  Education  adopts  adequate  rules  for 
their  physical  re-examination,  there  is  nothing  to  prevent  their  engaging 
in  other  occupations  while  continuing  to  draw  pensions  granted  for  specific 
reasons  no  longer  existing.  The  expense  of  such  pensions  is  entirely 
unwarranted. 


18 


6.  That  retirements  for  disability  of  an  obviously  temporary  character, 
which  are  permitted  under  the  present  law,  have  been  made,  may  be 
illustrated  by  the  following  recommendation  of  a  district  superintendent 
to  the  Board  of  Retirement : 

"Miss *  is  comparatively  young,  and  I  should  hesitate  to  say 

that  she  has  outlived  her  usefulness  as  a  teacher;  but  at  the  present 
time  I  should  say,  emphatically,  that  she  should  be  retired  in  accordance 
with  her  wish  until  such  time  as  her  usefulness  has  been  fully  restored." 

7.  The  practice  of  early  retirement  on  the  ground  of  disability  was 
introduced  by  a  change  in  the  retirement  law  in  1905.  Since  then,  of  the 
total  1,231  teachers  placed  on  the  pension  roll,  346  teachers,  or  28.11  per 
cent.,  retired  after  less  than  thirty  years  of  service  on  the  ground  of  dis- 
ability. The  increase  in  the  proportion  of  those  availing  themselves  of 
early  retirements,  the  average  amount  of  pension  granted,  as  well  as  the 
total  annual  charge  added  to  the  liabilities  of  the  fund  on  account  of  annual 
retirements,  are  set  forth  in  detail  in  Table  20,  page  125.  Tables  21  and  22, 
page  126,  show  in  detail  the  length  of  service,  present  age  and  annual  charge 
for  the  297  disability  pensions  on  the  roll  on  September  i,  19 15,  as  well  as 
additions  and  cancellations  of  disability  pensions  from  1905  to  September 
I,  1915.  The  detail  statement  on  which  this  table  is  based  is  not  appended 
to  this  report  because  of  its  bulk.  It  is  on  file  in  the  office  of  the  Commis- 
sion on  Pensions,  and  may  be  used  as  a  basis  for  the  re-examination  of  the 
pensioners,  if  such  action  is  determined  upon  in  the  near  future. 


Crediting  of   Outside   Experience   Without   Payment  of   Contribution 
Arrears  Unwarranted 

Under  the  present  law  credit  is  given  for  teaching  service  outside  of 
the  schools  of  the  city  of  New  York.  Teachers  retiring  after  thirty  years 
of  service  and  those  retiring  on  the  ground  of  disability  after  twenty 
years  of  service  are  required  to  have  served  a  minimum  of  only  fifteen 
years  in  New  York  City  schools.  For  compulsory  retirement,  at  the  dis- 
cretion of  the  Board  of  Education,  after  65  years  of  age  is  reached,  no 
minimum  service  in  New  York  City  is  required. 

It  does  not  seem  fair  to  expect  the  taxpayers  to  pay  pensions  for 
services  from  which  they  have  derived  no  benefit.  No  contributions  to 
the  fund  are  made  by  teachers  for  the  period  served  outside  of  the  city, 
which  is  not  only  inequitable  to  the  contributing  New  York  teachers,  but 
has  been  one  of  the  causes  for  the  present  unsatisfactory  condition. 

As  may  be  seen  from  the  data  presented  in  Tables  16  to  19,  pages 
122  to  124,  180  teachers,  or  11.8  per  cent.,  of  the  total  number  of  1,521  pen- 

*  The  retirement  number  of  the  teacher  is   1,554. 

19 


sioners  on  the  rolls  on  June  30,  19 14,  had  to  be  credited  with  service  outside 
of  the  city  of  New  York  to  become  eligible  for  retirement. 

Special  Privileges  of  Hunter  College  Teachers  Unwarranted 

The  retirement  law  grants  special  privileges  to  teachers  and  professors 
of  Hunter  College.  Notwithstanding  the  higher  salaries  received  by  pro- 
fessors during  active  service  and  the  consequent  greater  opportunity  to 
provide  for  their  old  age,  their  benefits  are  increased  to  more  than  one-half 
of  final  salary  by  the  grant  of  pensions  of  even  multiples  of  $1,000.  No 
minimum  service  in  New  York  City  is  required  for  retirement  after  thirty 
years'  teaching  experience.  In  case  of  retirement  for  disability  after  twenty 
years'  teaching  experience,  a  minimum  of  local  service  of  only  ten  years 
is  required. 

These  deviations  from  the  general  benefit  provisions  in  favor  of  the 
teaching  staff  of  Hunter  College  can  hardly  be  justified.  The  evil  and 
costly  consequences  of  special  pension  privileges  lie  in  the  setting  of  con- 
stantly higher  and  more  expensive  precedents  and  create  dissatisfaction 
among  those  not  specially  privileged. 

Uniform  Provisions  for  Men  and  Women  Teachers  Questionable 

Present  retirement  provisions  make  no  distinction  between  the  benefits 
of  men  and  women  teachers  who  contribute  the  same  percentage  of  salary. 
This  is  inequitable  to  the  men  teachers,  whose  pensions  are  less  costly  than 
those  granted  to  women  teachers.  In  the  first  place,  the  mortality  among 
men  pensioners  is  higher  than  among  women  pensioners,  resulting  in  a 
comparatively  smaller  number  of  pension  payments.  Secondly,  men 
teachers  remain  in  active  service  longer  than  women  teachers  and  there- 
fore contribute  to  the  fund  a  larger  proportion  of  the  cost  of  their 
pensions. 

As  shown  in  Tables  14  to  19,  pages  121  to  124,  82  pensioners,  or  5.4 
per  cent.,  of  the  total  of  1,521  pensioners  on  the  roll  on  June  30,  1914, 
were  retired  men  teachers.  Eleven,  or  13  per  cent.,  of  the  82  pensioned 
men  teachers  were  retired  for  disability  at  the  average  age  of  54.82  years. 
In  the  case  of  women  pensioners,  278,  or  19  per  cent.,  of  their  total  num- 
ber of  1,439  were  pensioned  for  disability,  at  the  average  age  of  48.39  years. 

Of  the  71  men  teachers  receiving  service  pensions,  45  retired  after 
an  average  of  41.69  years  in  local  service  (Table  16,  page  122),  while  of 
the  1,161  women  teachers  receiving  service  pensions,  1,058  retired  after 
an  average  of  only  37.40  years  in  local  service  (Table  17,  page  123).  The 
corresponding  average  retirement  age  was  68.09  years  for  men  and  57.13 
years  for  women. 

Divided  Responsibility  Handicap  to  Effective  Administration 

The  chief  defect  in  the  present  method  of  administering  the  pension 
fund  is  the  wide  distribution  of  responsibility  for  retirements  among  a 

20 


large  number  of  people,  whose  functions  in  connection  with  pension  man- 
agement are  only  a  small  and  comparatively  insignificant  part  of  their  prin- 
cipal duties.  This  is  especially  unsatisfactory  because  the  retirement  law 
is  not  definite,  a  condition  which  makes  all  retirements  depend  on  official 
discretion,  and  leaves  the  details  of  management  to  be  regulated  from 
time  to  time  by  departmental  regulations. 

The  lack  of  a  clear  definition  in  the  law  of  what  constitutes  disability 
is  a  serious  defect.  No  steps  whatever  have  been  taken  to  determine 
whether  disability  pensioners  have  regained  their  health  and  are  able 
to  resume  service. 

In  conclusion,  it  must  be  pointed  out  that  the  exercise  of  the  semi- 
judicial  function  of  interpreting  pension  provisions  by  department  officers 
responsible  for  operative  results  is  wrong  in  principle  and  has  invariably 
failed  to  work  well  in  practice.  The  temptation  is  ever  present  to  utilize 
the  benefits  of  the  fund  for  current  administrative  purposes,  and  with  the 
responsibility  for  fund  management  scattered  among  a  large  number  of, 
officers  and  made  a  subordinate  part  of  other  duties,  the  most  liberal  inter- 
pretation of  the  retirement  law  and  generous  expenditure  of  pension  moneys 
is  rendered  so  easy  as  to  become  a  matter  of  fact. 


21 


CHAPTER   III 

COST  OF  PRESENT  PLAN   UNDER  EXISTING   METHOD 

The  cost  of  benefit  provisions,  its  distribution  between  taxpayer  and 
employee,  and  the  method  adopted  for  meeting  fund  requirements  are 
important  questions  which  must  be  disposed  of  after  the  consideration  of  the 
retirement  scheme  from  the  viewpoint  of  its  effect  on  the  efficiency  of 
the  service.  The  main  distinguishing  feature  of  a  "financially"  sound 
pension  scheme  is  a  clear  understanding  with  regard  to  the  above  three 
questions  on  the  part  of  the  taxpayer  and  employee.  The  absence  of  such 
understanding  in  the  case  of  the  teachers'  retirement  fund  during  the  21 
years  of  its  operation,  as  well  as  the  numerous  fallacies  and  misconcep- 
tions which  have  established  themselves  in  the  minds  of  the  public  and  the 
employee  in  New  York  and  other  municipalities  with  regard  to  the  finan- 
cial operation  of  pension  funds,  necessitate  a  somewhat  detailed  discussion 
of  the  questions  of  cost  and  methods  of  meeting  that  cost. 

Two  Methods  of  Meeting  Cost  of  Pensions 

There  are  two  distinct  methods  which  may  be  adopted  for  meeting  the 
cost  of  pensions: 

1.  The  "cash  disbursement"  plan. — Sufficient  funds  are  provided 
currently,  as  payments  to  pensioners  fall  due. 

2.  The  "reserve"  plan. — Amounts  necessary  to  be  set  aside  during 
the  active  service  of  employees  to  provide  for  their  pensions  when 
they  retire,  are  accumulated  at  interest  and  form  a  reserve  fund,  out 
of  which  pension  payments  may  be  made  as  they  become  due. 

The  main  distinction  between  the  two  plans  is  that  in  the  first  the 
interest  factor  is  disregarded,  making  its  apparent  cost  to  the  city  or  to 
those  who  must  provide  the  funds  about  twice  as  much,  eventually,  as  the 
cost  under  the  reserve  plan.  Under  both  plans  an  actuarial  valuation  or 
appraisement  of  the  fund  requirements  is  necessary  to  enable  officers  to  set 
aside  the  proper  "reserve"  for  investment  on  the  one  hand,  or  to  determine 
the  future  encumbrances  on  the  city's  taxables  on  the  other,  for  the  "cash 
disbursement"  plan  operates  as  an  encumbrance  on  the  future  revenues  of 
the  city  unless  some  other  method  is  provided  for  the  fund's  revenue. 

Teachers'  Retirement  Fund  Operates  on  "Cash  Disbursement"  Basis 

At  the  establishment  of  both  the  old  New  York  and  the  Brooklyn 
Teachers'  Retirement  Funds  in  1894  and  1895,  respectively,  as  well  as  at 
the  time  of  the  merging  of  these  funds  into  one  in  1901,  no  estimates  of  cost 
were  made,  and  no  definite  or  adequate  plan  for  financing  fund  require- 
ments was   adopted.     Without  intent   on  the  part  of  the   founders   and 

22 


subsequent  builders  of  the  fund,  it  operated  in  the  beginning  on  a  sort  of 
semi-reserve  plan,  the  excess  of  income  over  disbursements  developing  a 
reserve  (see  Table  lo,  page  117)  during  the  earlier  years,  which,  how- 
ever, was  never  sufficient  to  make  the  fund  solvent  on  the  theory  of  a 
strictly  "reserve"  plan.  When  the  fund,  since  1910,  was  forced  to  draw 
on  its  reserve  capital  to  satisfy  current  pension  payments,  it  began  to  change 
its  method  of  operation,  until  at  the  present  time  it  operates  on  the  "cash 
disbursement"  plan  pure  and  simple,  as  there  are  no  accumulated  reserves 
and  the  entire  annual  income  is  immediately  paid  out  to  satisfy  current 
pension  demands. 

Pensions  Will  Amount  to  More  Than  20  Per  Cent  of  Salaries 

The  cost  of  benefit  provisions  is  generally  calculated  on  the  assumption 
that  the  fund  operates  on  the  "reserve"  basis,  and  the  compound  interest 
is  one  of  the  most  important  factors  in  such  calculations.  In  the  actuarial 
appraisement  of  the  fund's  assets  and  liabilities,  the  Commission  on  Pen- 
sions has  followed  this  general  practice.  In  order,  therefore,  to  give  an 
approximate  idea  of  the  future  operation  of  the  fund  with  the  interest 
factor  eHminated  from  consideration,  the  following  cost  approximations 
are  made: 

Let  us  take,  as  an  example,  a  woman  teacher  who  enters  the  service 
at  the  age  of  20  and  retires,  after  a  service  of  37  years,  at  the  age  of  57, 
on  one-half  of  her  salary  at  the  date  of  retirement.*  Let  us  further  assume 
that  she  was  an  elementary  school  teacher,  starting  with  a  salary  of  $720 
per  annum  for  the  first  three  years,  receiving  during  the  next  twelve  years 
annual  increases  under  the  Salary  Schedule  B-i,  now  in  force  (see  Table  4, 
opposite  page  112),  and  drawing  during  the  final  twenty-two  years  of  her 
service  prior  to  retirement  a  uniform  salary  of  $1,500  per  annum. 

According  to  the  mortality  experience  determined  for  women  teachers 
during  the  present  valuation  of  the  teachers'  retirement  fund  (see  page  38), 
the  average  expectation  of  life  of  a  teacher  retiring  at  57  years  of  age 
is  about  18  years.  Assuming  that  in  the  case  used  for  illustration,  the 
teacher  retiring  on  a  pension  of  $750  (half  of  her  salary  of  $1,500  at  date 
of  retirement)  lives  18  years  after  retirement,  she  will  draw  $13,500  in 
pensions  (18  X  $75o),  or  about  28  per  cent,  of  her  total  compensation  of 
$48,480  during  her  active  service  of  37  years. 

When  a  pension  plan  is  operated  on  the  "cash  disbursement"  plan,  the 
pension  demands  are  small  in  the  beginning.  They  constantly  increase, 
however,  for  more  pensioners  are  put  on  the  roll  than  are  dropped  on 
account  of  death.  If  it  were  assumed  that  the  quota  of  the  teaching  force, 
the  salary  rates  and  the  pension  conditions  were  to  remain  unchanged,  the 
annual  demands  of  the  fund  would  gradually  become  normal  and  eventually 
form  a  certain  uniform  percentage  of  the  salary  roll. 

*  Entrance  and  retirement  age,  as  well  as  service,  are  averages  for  the  1,058  women  pen- 
sioners on  the  rolls  on  June  30,  1914,  who  were  pensioned  after  a  service  of  30  or  more  years  in 
New  York  City  schools   (see  Table   17,  page  123). 

23 


If  every  member  of  the  teaching  force  entered  the  service  and  retired 
under  indicated  conditions,  then  the  annual  pension  payments,  which  at 
present  are  only  4.15  per  cent,  of  the  annual  salary  roll  (See  Table  12, 
page  120)  would  increase  in  the  course  of  the  next  30  to  35  years,  when 
the  financial  load  on  the  fund  will  be  approximately  normal,  to  about  28 
per  cent,  of  the  active  payroll. 

There  are,  however,  a  number  of  factors  which  would  tend  to  increase 
the  proportionate  cost  of  pensions  under  present  provisions,  as  illustrated 
in  the  foregoing  average  retirement  case.  The  more  important  of  these 
factors  are: 

1.  "Early  Pensions" — Pensions  granted  after  short  periods  of 
service  for  disability  not  necessarily  impairing  the  pensioner's  chances 
for  long  life,  although  smaller  in  amount  than  regular  service  pen- 
sions, cost  comparatively  more  (see  illustration  on  page  32).  As 
shown  in  Table  20,  page  125,  28.11  per  cent,  of  all  retirements  made 
since  1905  were  on  the  ground  of  disability  after  a  service  of  less  than 
30  years. 

2,  "Outside  Teaching  Experience" — Retired  teachers  allowed 
credit  for  service  rendered  in  schools  other  than  those  of  the  City  of 
New  York  will  draw,  comparatively,  a  larger  amount  in  pensions  as 
compared  to  their  total  salaries  received  from  the  City  of  New  York 
than  pensioners  who  served  their  entire  term  in  local  schools  Of 
the  total  of  1,521  retired  teachers  on  the  rolls  on  June  30,  1914,  180 
pensioners,  or  11.8  per  cent.,  were  given  credit  for  "outside"  teaching 
experience  in  order  to  make  possible  their  retirement  after  20  or  30 
years'  service  under  present  pension  provisions  (see  Tables  16  to  19, 
pages  122  to  124). 

While  the  above  indicated  provisions  would  increase  the  proportion  of 
pension  to  compensation  for  active  service  to  more  than  the  previously 
estimated  28  per  cent.,  there  are  certain  factors  in  the  operation  of  the 
scheme  which  tend  to  reduce  the  pension  cost.  The  more  important  of 
these  factors  are  as  follows: 

1.  Resignations — A  considerable  number  of  teachers  resign  with- 
out receiving  any  return  from  the  fund  (see  Table  5,  page  113).  The 
majority  of  these  resignations,  however,  occur  after  short  periods  of 
service,  resulting  in  only  a  small  gain  to  the  fund  from  individual 
forfeitures. 

2.  Deaths — A  number  of  teachers  die  while  in  active  service. 
The  number  of  deaths,  however,  as  shown  in  Table  5,  is  comparatively 
small. 

3.  Retirements  of  Men  Teachers — Men  teachers,  as  a  rule,  unless 
they  receive  credit  for  outside  experience,  remain  longer  in  the  service, 
receive  more  in  aggregate  salaries,  and  retire  later  in  life,  drawing 
less  in  pensions  in  proportion  to  active  pay,  than  women  teachers.    The 

24 


proportion  of  men  teachers  in  the  service,  however,  is  only  about  12.7 
per  cent,  of  the  total  teaching  force  (as  of  May  31,  1915 — see  Table 
I,  page  109).  The  retired  list  on  June  30,  1914,  contained  only  82  men 
teachers,  or  5.4  per  cent.,  of  the  total  of  1,521  pensioners  on  the  roll 
(see  Tables  14  and  15,  pages  121  and  122). 

Considering  these  factors  for  the  increase  and  decrease  of  the' cost  of 
pensions  as  approximated  for  the  purpose  of  illustration  in  the  assumed 
average  retirement  case,  it  becomes  evident,  even  without  actuarial  calcula- 
tions, that  the  pension  roll  will  gradually  increase  until  it  will  amount 
to  about  20  per  cent,  or  more  of  the  salary  roll.  An  actuarial  estimate  of 
thisi  increase  shows  that  the  annual  demands  for  pensions  will  approach  a 
normal  load  slightly  in  excess  of  20  per  cent,  of  the  payroll,  if  the  present 
pension  provisions  be  continued. 

Actuarial  Forecast  of  Future  Police  Pensions  Indicates  Rapid  Increase 
in  Pension  Roll  is  Inevitable 

The  most  effective  way  of  showing  future  increases  in  pension  pay- 
ments is  to  calculate  the  amounts  which  will  be  required  annually  to  pay 
current  pensions  and  to  compare  such  amounts  with  the  salary  roll.  Such 
calculations  require  a  great  outlay  of  time,  are  not  essential  in  determining 
the  cost  of  present  and  proposed  benefit  provisions,  and  their  usefulness 
is  limited  to  the  demonstration  of  disadvantages  of  operating  a  plan  on  the 
"cash  disbursement"  basis.  In  addition,  such  calculations,  illustrating  the 
operation  of  a  mathematical  principle  of  equal  application  to  all  pension 
funds,  have  been  made  in  a  recently  published  report  by  the  Bureau  of 
Municipal  Research  on  the  New  York  Police  Pension  Fund.  For  these 
reasons  the  Commission  on  Pensions  has  not  computed  the  amounts  which 
will  be  required,  year  by  year,  to  pay  teachers'  pensions. 

The  late  H.  W.  Manly,  an  authority  on  pensions  of  world-wide  repu- 
tation, commented  upon  the  New  York  Police  Pension  Report  as  follows : 

"British  actuaries  have  had  to  fight  for  years  the  common  view 
that  so  long  as  the  funds  are  increasing  all  is  well  with  the  fund,  and 
there  is  no  necessity  to  consult  an  actuary,  and  it  is  only  when  the 
patient  gets  sick  and  weakly  that  there  is  any  need  to  call  in  the  doctor, 
in  the  shape  of  an  actuary,  to  set  everything  right  again.  It  was  only 
by  showing  the  future  progress  of  these  funds  that  the  actuary  at  last 
gained  the  victory,  and  I  feel  that  Tables  30  and  31  ought  to  make  a 
deep  impression  on  the  city  authorities." 

The  police  fund's  pension  payments  in  1912  amounted  to  14.46  per 
cent,  of  the  payroll.  The  tables  referred  to  by  Mr.  Manly  made  an  actuarial 
forecast  of  future  increases,  which,  in  summarized  form,  are  given  on  page 
26. 

25 


Year  After  Valuation 


Annual 

Pension 

Payments 


Annual 

Salary 

Payments 


Percentage 
of  Salaries 
in  Pensions 


1 
2 
3 
4 
5 

10 
20 
30 
40 
50 
60 
70 
80 
85 


$2,265,204 
2,381,685 
2,502,610 
2,624,788 
2,748,086 
3,327,707 
4,196,560 
4,767,819 
4,967,753 
4,980,994 
4,971,870 
4,971,343 
4,970,912 
4,970,866 


$14,981,250 
15,151,921 
15,019,718 
15,285,904 
15,310,319 
15;529,996 
15,423,237 
15,024,460 
14,884,963 
14,866,417 
14,865,410 
14,865,410 
14,865,410 
14,865,410 


15.12* 

15.72* 

16.66 

17.17 

17.95 

21.43 

27.21 

31.73 

33.37 

33.51 

33.45 

33.44 

33.44 

33.44 


Experience   of   City's   Pension   Funds   Illustrates   Growth   of   Pension 
Demands 

To  place  further  emphasis  on  the  certainty  of  the  rapid  growth  of 
pension  demands,  the  past  experience  of  five  large  city  pension  funds, 
including  the  teachers',  is  offered  for  consideration.  A  great  number  of 
factors,  which  vary  in  each  fund,  govern  the  ultimate  limitations  of  future 
increases  in  pension  and  salary  payments,  such  as  scales  of  benefits,  admin- 
istration of  pension  provisions,  mortality  rates,  increases  in  quota,  salaries 
of  the  active  force,  etc.  The  combined  operation  of  such  factors,  however, 
based  upon  incontrovertible  natural  laws,  causes  during  a  great  number 
of  years  the  more  rapid  increase  in  pensions  than  in  salaries.  This  is 
forcibly  brought  home  by  the  increases  in  the  percentage  relation  of  pen- 
sions to  salaries  during  the  years  1905  to  1914  in  the  five  large  pension 
funds  of  the  city  indicated  below : 


Proportion  of  Pensions  to  Payroll  During  the 

Year 
Estab- 

Years Indicated 

Pension  Fund 

lished 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 

1913 

1914 

Police   Pension 
Fund 

1857 
1871 

11.35 
11.81 

11.31 
11.32 

12.11 
11.33 

12.09 
11.29 

12.17 
11.59 

12.35 
12.09 

13.04 
13.05 

14.46 
14.38 

15.73 
13.85 

16.16 

Fire  Department 
Relief  Fund 

14.08 

Teachers'      Retire- 
ment Fund 

1894 

3.65 

3.87 

3.82 

3.92 

4.02 

4.09 

3.82 

4.10 

4.15 

Health  Department 
Pension  Fund . . . 

1894 

1.60 

1.50 

2.33 

2.31 

2.62 

2.69 

2.82 

3.25 

3.86 

5.92 

Street  Cleaning 

Department  Re- 
lief and  Pension 
Fund 

1911 

.38 

2.44 

3,49 

*  Compare  these  estimated  with  the  actual  percentages  of  15.73  per  cent,  and   16.16  per  cent, 
for  the  years   191 3   and    1914  as  given   in   the  table  below. 

26 


In  ten  years,  be  it  observed,  the  police  pension  fund  grew  from  11.35 
per  cent,  of  the  annual  payroll  to  16.16  per  cent.;  the  fire  fund  from  a  pro- 
portion of  1 1. 81  to  14.08  per  cent.  Since  1906  teachers'  pensions  have 
advanced  from  3.65  to  4.15  per  cent,  the  rate  of  advance  being  temporarily 
checked  in  1912  by  salary  increases.  The  expansion  of  the  teachers'  fund 
is  inevitable  if  the  present  plan  is  pursued.  In  computing  the  future  pro- 
portion of  pensions  to  salary  roll,  the  withdrawals  of  teachers  from  service 
without  pensions  is,  of  course,  taken  into  consideration. 


Reorganization  Necessary  to  Prevent  Future  Disappointment 

It  is  often  maintained  that  a  municipal  pension  fund  cannot  become 
bankrupt,  no  matter  what  its  statutory  revenues  are ;  that  the  moral  obliga- 
tion of  the  public  to  city  employees  is  so  strong  that  in  case  of  insufficiency 
of  funds  its  resources  will  be  increased. 

Let  us  assume  that  teachers  will  avail  themselves  of  the  distressing 
features  of  the  present  situation  to  appeal  to  the  legislature  and  succeed 
in  forcing  on  the  city  the  requirement  of  making  good  any  future  defi- 
ciencies which  may  occur  in  the  fund.  It  has  been  done  in  the  case  of  the 
police  pension  fund  in  1892  and  the  fire  department  relief  fund  in  1912, 
and  the  repetition  of  such  a  procedure  in  the  case  of  the  teachers'  retire- 
ment fund  would  not  be  unprecedented. 

It  may  be  safely  predicted,  however,  that  such  a  measure  to  extend 
the  fund's  resources  to  the  capacity  of  the  city's  taxing  power  would  not 
last  long.  The  general  public  does  not  now  realize  the  amount  of  money 
it  has  been  and  is  paying  for  teachers'  pensions.  This  is  effectively  hidden 
by  the  automatic  reversion  of  indirect  city  contributions  (unrefunded 
absence  deductions  and  excise  moneys)  to  the  uses  of  the  fund.  The  ques- 
tion of  cost  begins  to  impress  itself  on  the  public  mind  only  when  it  appears 
clearly  as  a  budgetary  item. 

If  the  city  were  to  make  good  future  deficiencies  in  the  teachers' 
retirement  fund,  it  would  be  called  upon  to  do  so  immediately  after  the 
passage  of  the  law,  as  the  present  revenues  are  insufficient  to  cover  current 
demands.  As  has  been  estimated  in  the  preceding  pages,  the  pension  pay- 
ments will  increase  in  the  future  to  about  20  per  cent,  of  the  payroll. 
Assuming  that  the  annual  salary  expenditure  remains  stationary,  the  pen- 
sion demands  will  eventually  amount  to  about  $6,000,000  (20  per  cent,  of 
the  payroll  of  $30,000,000  as  of  May  31,  1915 — see  Table  i,  page  109).  The 
teachers'  contributions,  remaining  stationary  at  i  per  cent,  of  salaries, 
would  furnish  only  $300,000;  the  excise  taxes  and  unrefunded  absence 
deductions  would  under  favorable  conditions  make  available  twice  as  much, 
or  $600,000,  while  the  balance  of  $5,100,000  would  become  a  direct  charge 
on  the  taxpayer. 

It  is  logical  to  suppose  that  the  growth  of  the  annual  deficiencies  in  the 
fund  to  an  amount  in  excess  of  $5,000,000  a  year  would  not  pass  entirely 
unnoticed.    Long  before  such  a  stage  is  reached,  a  popular  demand  for  the 

27 


reorganization  of  the  fund  would  be  brought  about  and  a  reduction  of  its 
expenditures  enforced.  It  is,  therefore,  to  the  distinct  advantage  of  both 
the  taxpayer  and  the  teacher  to  unite  as  soon  as  possible  on  a  sound  reor- 
ganization plan,  in  order  to  avoid  unnecessary  expenditure  as  well  as  future 
disappointment  to  present  and  prospective  beneficiaries  of  the  fund.  This 
should  not  be  difficult  to  accomplish,  if  only  the  teachers  would  acquaint 
themselves  with  the  situation  and  realize  that  it  is  more  to  their  advantage 
to  have  reasonable  and  secure  provision  against  old  age  and  incapacity  than 
over-liberal  benefits  which  they  may  never  be  able  to  enjoy. 

Indirect  City  Contributions  Hide  Cost  of  Pensions 

In  connection  with  the  criticism  of  the  present  method  of  providing 
funds  to  meet  the  cost  of  pensions,  it  is  desired  to  call  special  attention  to 
its  worst  feature — the  use  of  miscellaneous  city  revenues  as  sources  of 
income.  In  the  first  place,  it  is  unfair  to  the  taxpayer,  since  it  throws  a 
cloak  of  mystery  over  the  real  cost  of  pensions.  The  money  becoming 
available  each  year  from  these  indirect  sources  automatically  reverts  to  the 
fund  and  is  used  up  without  the  public  realizing  the  true  proportions  of 
the  expenditure.  Secondly,  there  is  no  parallel  between  the  growth  of  mis- 
cellaneous revenues  applicable  to  the  fund  and  pension  payments,  since 
increases  in  revenues  seldom,  if  ever,  grow  at  the  rate  of  pension  liabilities. 

It  is,  therefore,  in  the  interest  of  both  the  taxpayer  and  the  present 
and  prospective  beneficiaries  of  the  fund  that  it  should  not  derive  its  income 
from  miscellaneous  revenues,  a  method  which  creates  the  erroneous  im- 
pression of  shifting  the  pension  burden  from  both  the  taxpayers  and  the 
beneficiaries.  The  city's  part  of  the  pension  fund  cost  should  be  met  sys- 
tematically and  openly  by  budgetary  appropriations. 


28 


CHAPTER  IV 

RESERVE  OR  "  THINK  OF  THE  FUTURE "  PLAN  AND  THE 

PRESENT  FUND 

Advantages  of  Operating  Fund  on  "Reserve"  Basis 

Scientifically  managed  and  actuarially  sound  pension  funds  are  gen- 
erally operated  on  a  "reserve"  basis.  This  necessitates,  as  has  been  stated 
previously,  the  setting  aside  during  the  active  service  of  employees  of 
definite  amounts  properly  calculated  and  usually  expressed  as  a  percentage 
of  the  current  annual  payroll.  The  amounts  so  set  aside  are  accumulated 
at  interest  and  form  a  "reserve"  fund,  out  of  which  pension  disbursements 
may  be  made  as  they  become  due. 

Under  such  an  arrangement,  the  advantage  of  the  compound  interest 
factor  is  secured,  which  reduces  the  apparent  cost  of  pensions  to  more  than 
one-half  of  the  apparent  cost  under  the  "cash  disbursement"  plan.  All 
other  conditions  being  equal,  the  same  amounts  are  actually  paid  out  in 
benefits  under  both  plans.  The  pension  cost,  however,  is  measured  under 
the  "reserve"  plan  by  the  percentage  of  the  payroll  needed  to  be  set  aside 
currently  to  secure  future  pensions,  while  such  cost  under  the  "cash  dis- 
bursement" plan  is  measured  by  the  percentage  which  the  current  pension 
payments  form  of  the  annual  payroll.  The  first  is  a  constant  factor,  and  in 
the  case  of  the  teachers'  retirement  fund  operating  under  existing  pror 
visions  has  been  determined  to  be  about  4  per  cent,  for  men  and  about 
7  per  cent,  for  women  teachers.  The  second  is  a  changing  and  constantly 
increasing  factor  and,  as  has  been  previously  explained,  will  eventually 
amount  to  more  than  20  per  cent,  of  the  payroll. 

The  main  advantage  of  operating  a  pension  fund  on  the  "reserve" 
basis  is  in  the  clear  understanding  of  the  pension  cost,  which  is  secured  by 
the  definite  and  constant  relationship  which  each  year's  contribution  to  the 
pension  fund  bears  to  the  same  year's  expenditure  for  active  services. 
Having  been  accepted  as  reasonable  by  all  concerned,  the  possibility  of 
arbitrary  discontinuance  of  the  scheme  and  consequent  disappointment  of 
prospective  beneficiaries  is  avoided.  Furthermore,  each  generation  of  tax- 
payers and  teachers  pays,  currently,  its  own  obligations.  A  proportionate 
part  of  the  future  pension  requirement  is  set  aside  each  year,  and  if  calcu- 
lated properly  the  pension  scheme  under  such  conditions  is  solvent  at  all 
times. 

$54,700,000  Deficiency  on  June  30,  1914 

In  the  actuarial  appraisement  of  the  teachers'  retirement  fund,  the  details 
of  which  are^resented  in  Part  III  of  this  report,  the  actual  experience  of 
the  fund  during  the  six-year  period — July  i,  1908,  to  June  30,  1914 — has  been 

29 


used  as  a  basis  for  estimating  its  future  operation.    The  rate  of  interest  used 
in  computations  was  4  per  cent. 

The  results  of  the  appraisement,  showing  the  condition  of  the  fund  as  it 
was  on  June  30,  1914,  are  presented  in  detail  in  the  valuation  balance  sheets 
on  page  170,  a  summary  of  which  is  as  follows: 

Liabilities 

Value  of  1,521  pensions  already  granted $11,581,210 

Value  of  prospective  pensions  to  teachers  now  in  service 58,228,550 

Total $69,809,760 

Assets 

Funds  in  hand $882,715 

Value  of  future  1%  salary  contributions  of  teachers  now  in  service 4,183,725 

Value  of  future  city  contributions  of  unexcused  absence  deductions  and  5% 

of  excise  taxes  which  can  be  credited  to  teachers  now  in  service 10,000,000 

Deficiency,  unprovided  for 54,743,320 

Total $69,809,760 


Following  the  usual  practice,  the  above  valuation  balance  sheet  considers 
only  the  teachers  in  active  service  and  on  pension  on  June  30,  1914,  leaving 
"new  entrants,"  i.  e.,  teachers  who  enter  the  service  subsequently,  out  of 
consideration. 

The  liabilities  of  the  fund  show  the  discounted,  or  "present,"  value  of 
future  pension  payments.  In  explanation,  the  total  liability  of  the  fund 
shown  in  the  balance  sheet  in  the  sum  of  $69,809,760  represents  the  capital 
amount  which,  if  invested  on  June  30,  1914,  will  be  just  sufficient,  together 
with  future  interest  accumulations  at  4  per  cent.,  compounded  annually,  to 
make  future  pension  payments  to  teachers  already  retired  and  to  those  of  the 
teachers  in  the  active  service  on  that  date  who  will  subsequently  retire. 

The  assets  of  the  fund  show,  in  addition  to  the  money  actually  on  hand 
at  date  of  valuation,  the  discounted,  or  "present"  value  of  the  moneys  which 
will  be  paid  into  the  fund  in  the  future  by  teachers  who  were  in  the  service 
on  the  date  of  the  valuation,  and  by  the  city  in  respect  of  these  teachers.  The 
cash  on  hand  June  30,  1914,  amounted  only  to  $882,715,  which  is  insufficient 
to  pay  even  one  year's  pension  charge.  The  value  of  the  future  i  per  cent, 
salary  contributions  of  the  teachers  adds  $4,183,725,  and  that  part  of  the 
5  per  cent,  excise  tax  and  unrefunded  salary  deductions  for  absence  which 
may  be  credited  to  teachers  who  were  in  the  service  at  the  date  of  valuation 
further  increases  the  assets  by  an  uncertain  amount,  which,  due  to  lack  of 
basis  for  an  accurate  forecast,  is  roughly  approximated  at  $10,000,000. 

The  total  of  these  assets — $15,066,440 — is  inadequate  to  equal  the  total 
liabilities  of  $69,809,760  by  $54,743,320.  The  amount  of  this  deficiency  rep- 
resents the  capital,  or  reserve,  which  should  have  been  on  hand  in  the  fund 
in  addition  to  the  $882,715  on  June  30,  1914,  to  make  the  fund  solvent.  It 
would  have  enabled  the  fund,  together  with  future  accumulations  of  4  per 
cent,  compound  interest,  to  supplement  its  inadequate  future  income. 

30 


Rapid  Increase  in  Shortage  Since  that  Date 

The  large  amount  of  shortage — $54,743,320 — which  is  a  direct  result  of 
the  fund's  insufficient  income  during  the  21  years  of  its  past  operation,  does 
not  give,  however,  an  adequate  idea  of  the  seriousness  of  the  situation.  It 
merely  represents  the  deficiency  as  it  existed  on  June  30,  1914.  The  fund's 
reorganization  is  made  more  difficult  as  time  passes,  since  under  the  present 
method  of  operation  it  merely  serves  as  a  means  of  developing  a  constantly 
increasing  deficit. 

The  rapid  increase  in  the  deficiency,  due  to  the  absence  of  the  reserve  of 
$54,743,320,  may  be  easily  appreciated  when  it  is  considered  that  simple 
interest  alone  at  4  per  cent,  of  the  above  amount  would  have  yielded  to  the 
fund  $2,189,733  for  the  year  ending  June  30,  1915.  The  lack  of  interest 
accumulations    therefore    increased    the    deficiency    during    one    year    to 

$56,933,053- 

The  "new  entrants"  into  the  fund,  i.  e.,  teachers  employed  after  June  30, 
1914,  involve  the  fund  into  still  further  financial  difficulties.  Neither  their 
future  pensions  nor  the  fund's  future  income  on  their  behalf  has  been  taken 
into  account  in  the  valuation  of  assets  and  liabilities.  The  deficiency  of  the 
fund,  therefore,  increases  with  the  employment  of  each  additional  teacher, 
when  it  is  considered  that  the  fund's  actual  income  is  at  present  about  3  per 
cent,  of  salaries  and  shows  a  tendency  for  future  decrease,  whereas  the 
income  required  to  guarantee  future  pensions  of  new  entrants  should  amount 
on  the  average  to  about  4  per  cent,  of  salaries  in  the  case  of  men  and  about 
7  per  cent,  in  the  case  of  women  teachers. 

The  percentages  of  salaries  required  to  be  paid  into  the  fund  on  account 
of  new  entrants,  according  to  age  at  entrance  into  the  service,  have  been 
calculated  and  presented  in  detail  on  page  171.  The  payments  required  at 
the  ages  indicated  below  are  as  follows : 


Men  Teachers 

Women  Teachers 

Age 

at 

Entrance 

Disability 

Service 

Disability 

Service 

into 

Pension 

Pension 

Total 

Pension 

Pension 

Total 

Service 

after 

after 

all 

after 

after 

all 

20  Years' 

30  Years' 

Pensions 

20  Years' 

30  Years' 

Pensions 

Service 

Service 

Service 

Service 

20 

.40 

3.05 

3.45 

1.41 

5.08 

6.49 

25 

.43 

3.50 

3.93 

1.13 

6.12 

7.25 

30 

.45 

3.96 

4.41 

.64 

6.54 

7.18 

35 

.43 

4.20 

4.63 

.35 

6.16 

6.51 

40 

.31 

3.89 

4.20 

.16 

5.16 

5.32 

31 


CHAPTER   V 
OPERATION  OF  THE  PRESENT  FUND  ILLUSTRATED 

The  results  of  the  actuarial  investigation  have  been  shown  by  the  valua- 
tion balance  sheet  and  the  rates  of  salary  contributions  that  would  be  re- 
quired. To  facilitate  a  clear  understanding  of  these  results  the  operation  of 
the  fund  under  the  present  provisions  as  applied  to  the  average  teacher  is 
illustrated  in  the  following  pages. 

Average  Entrance  and  Retirement  Ages 

The  following  table  gives  the  average  age  at  which  men  and  women 
teachers  have  entered  the  service  in  New  York  City  schools  and  the  average 
age  at  which  pensioners  were  retired  under  the  "disability"  and  "30  years' 
service"  provisions  during  the  six-year  period  ending  June  30,  1914: 


Entrance 
Age 

Disability- 
Retirement 
Age 

Service 

Retirement 

Age 

Men  teachers 

26  8 

54.3 
47.0 

66  1 

Women  teachers 

23.5 

57  4 

Comparison  of  Aggregate  Pay  and  Pension  of  Average  Teacher 

The  chart  on  page  33  shows  a  comparison  of  the  aggregate  pay  and 
pension  received  by  the  average  teacher.  The  teachers  are  considered  as 
entering  the  service  on  average  entrance  salaries,  such  as  were  paid  in 
1914,  namely,  $1,134  per  annum  in  the  case  of  men  and  $762  per  annum 
in  the  case  of  women.  The  salaries  are  estimated  to  increase  in  accordance 
with  the  scale  of  salary  changes  as  computed  by  the  Commission  on  Pen- 
sions and  presented  on  pages  157  and  158.  The  pension  is  based  on  the  final 
salary  which  would  be  allowable  at  the  time  of  retirement  and  is  considered 
to  continue  for  the  "average  lifetime"  of  the  pensioner.  No  allowance 
has  been  made  on  account  of  teachers  leaving  the  service  without  pensions. 

The  aggregate  salaries  and  aggregate  pensions  as  well  as  their  percent- 
age relation  in  the  four  "average"  cases  are  as  follows : 

Aggregate  Pension 

"Average"  Pensioner  Aggregate  Per  Cent. 

Salary  Amount  of  Aggregate 

Salary 

Man— Disability  Pensioner $57,269  $18,405  32 .  14 

Man— Service  Pensioner 87,503  13,930  15 .92 

Woman— Disability  Pensioner 31,923  13,840  43 .35 

Woman— Service  Pensioner 50,140  16,686  33 .28 

32 


ANNUAL     SALARY    AND    PENSION     PAYMENTS    RECEIVED    BY    THE     "AVERAGE 

PENSIONED  TEACHER 


3000^ 
2500 
zooo 
0(   I50O. 

< 

J    lOOO  . 
•>     BOO 


YCA^S  1 


Years  i 


2000^ 

y 

(f    ISOO, 

< 

J   lOOO. 

< 

"O-   500. 


Ykars  1 


zooo. 


> 

^    1500. 

< 

J    lOOO. 

< 

^     600. 
o  . 


Years  1 


Male- Disability   Pensioned 


lO  15  to  SS  So  35  3»0      ^ 

Male-  Service    Pensioner 


•45        49 


Female- Disability  Pensioned 


IIIIIIIIIIHIIIIIIII 


I        I 


•  16  20  ZS  30  35  Aa        4* 

Temale-  Service  Pensioner 


nm 


m 


25  30 


♦5 


50  52 


Salary 

lllllill 


-  LGGEND- 


Pensions 

lillllll 


33 


Value  of  "Average"  Teacher's  Pension  on  Theory  of  "Deferred"  Pay 

The  preceding  illustrations  show  the  relation  of  aggregate  salaries  and 
pensions,  and  assume  the  operation  of  the  fund  on  the  "cash  disbursement" 
principle,  which  disregards  the  interest  factor. 

Should  the  pension  be  regarded  in  the  nature  of  "deferred"  pay,  the 
teacher's  claim  not  only  to  the  proportion  of  salary  so  deferred  but  also  to  the 
accumulations  of  compound  interest  on  the  amounts  theoretically  withheld 
must  be  considered.  Under  this  theory,  the  pension  fund  is  assumed  to 
operate  on  the  "reserve"  principle. 

A  comparison  of  salaries,  excluding  the  i  per  cent,  contributions,  with 
pensions,  on  the  theory  of  a  reserve  or  "deferred"  pay  principle,  is  presented 
in  the  following  charts  in  the  case  of  the  "average"  man  and  woman 
teacher,  both  as  regards  total  and  one  year's  service.  It  is  really  a  compari- 
son of  present  rates  of  net  compensation  with  what  they  would  be  if  the 
present  pension  system  were  abolished  and  the  teachers  given  the  exact 
actuarial  equivalent  by  means  of  increases  in  salaries.  In  the  construction  of 
these  charts,  due  allowance  has  been  made  on  account  of  teachers  leaving 
the  service  without  pension. 


34 


COST  OF  ENTIRE  TEACHING   SERVICE   OF  THE      AVERAGE      TEACHER   COMPOSED 
OF  SALARY  ACTUALLY  PAID  AND  SALARY  "DEFERRED"  FOR  FUTURE  PENSION 


MALE 


FEMALE 


Pension  ^z.633 


Totol     Salary 

(less  one  percent 
dedvcction) 


^ 


59.501 


Pension  ^i.aas 


Total    Salary 

(^less  one  per  cent 
deduction) 


24.036 


35 


COST  OF  ONE  year's  TEACHING  SERVICE  OF  THE  "aVERAGE"  TEACHER  COM- 
POSED OF  SALARY  ACTUALLY  PAID  AND  SALARY  "DEFERRED"  FOR  FUTURE 
PENSION 


MALE 


female: 


Pension  ^  9i 


Salary 

(less  one  percent 
deduciion.) 


$ 


2,062 


Pension  ^lod 


Salary 

(le^s-   one  percent 
deduction) 


$ 


\,Z(oG 


36 


Value  of  a  $1  Pension  and  Average  Lifetime  of  Pensioners 

In  the  following  tables  are  given  the  annuity  values  used  as  a  basis  for 
calculating  the  cost  of  pensions.  These  tables  give  the  present  value  of  a 
pension  of  $i,  starting  at  any  age  desired.  While  the  expectations  of  life 
of  pensioners  at  various  ages  were  not  used  in  the  calculations,  they  were 
afterward  computed  and  are  shown  for  the  purpose  of  giving  an  idea  of  the 
probable  average  lifetime  of  teachers  retiring  at  various  ages. 


PRESENT  VALUE  AT  DATE  OF  RETIREMENT  OF  A  CONTINUOUS  LIFE  ANNUITY  OF 
ONE   DOLLAR    PAYABLE    TO    TEACHERS    RETIRING    AT    THE    AGES   SHOWN 


Age  at  Disability  Pensioners  Service  Pensioners 

Retirement 


Men  Women  Men  Women 


40 12.07  13.49  

41 11.92  13.35  

42 11.78  13.21  

43 11.64  13.06  

44 11.51  12.90  

45 11.39  12.74  

46 11.27  12.58  

47 11.16  12.41  

48 11.04  12.23  

49 10.91  12.05  

50 10.79  11.86  11.00  14.07 

51 10.65  11.67  10.86  13.84 

52 10.51  11.47  10.72  13.59 

53 10.37  11.26  10.57  13.35 

54 10.21  11.05  10.41  13.09 

55 10.04  10.84  10.23  12.83 

56 9.86  10.62  10.05  12.56 

57 9.67  10.39  9.86  12.28 

58 9.46  10.16  9.66  11.99 

59 9.23  9.93  9.45  11.70 

60 8.99  9.69  9.23  11.39 

61 8.74  9.45  9.01  11.08 

62 8.47  9.20  8.77  10.76 

63 8.20  8.95  8.54  10.43 

64 7.94  8.70  8.29  10.10 

65 7.69  8.45  8.04  9.76 

66 7.45  8.19  7.79  9.42 

67 7.22  7.93  7.54  9.08 

68 6.99  7.67  7.28  8.73 

69 6.76  7.40  7.02  8.39 

70 6.53  7.14  6.76  8.04 


37 


EXPECTATION    OF    LIFE    OR    AVERAGE    LIFETIME    OF    TEACHERS    RETIRING    AT 

THE  AGES  SHOWN 


Age  at 
Retirement 


Disability  Pensioners 


Men 


Women 


Service  Pensioners 


Men 


Women 


40 19.51 

41 19.12 

42 18.75 

43 18.39 

44 18.05 

45 17.72 

46 17.40 

47 17.09 

48 16.77 

49 16.44 

50 16.12 

51 15.78 

52 15.44 

53 15.09 

54 14.72 

55 14.35 

56 13.96 

57 13.56 

58 13.14 

59 12.70 

60 12.25 

61 11.79 

62 11.33 

63 10.86 

64 10.41 

65 9.99 

66 9.60 

67 9.22 

68 8.84 

69 8.47 

70 8.11 


22.81 

22.37 

21.93 

21.49 

21.04 

20.59 

20.14 

19.68 

19.21 

18.75 

18.28 

16.58 

23.01 

17.81 

16.24 

22.36 

17.34 

15.89 

21.71 

16.86 

15.52 

21.07 

16.39 

15.15 

20.42 

15.91 

14.76 

19.78 

15.44 

14.37 

19.13 

14.97 

13.96 

18.49 

14.49 

13.55 

17.84 

14.02 

13.13 

17.20 

13.55 

12.70 

16.55 

13.08 

12.28 

15.91 

12.62 

11.84 

15.27 

12.16 

11.41 

14.64 

11.70 

10.98 

14.01 

11.25 

10.55 

13.38 

10.80 

10.12 

12.77 

10.36 

9.70 

12.16 

9.92 

9.28 

11.57 

9.49 

8.86 

10.99 

9.06 

8.45 

10.43 

38 


CHAPTER  VI 
A  TENTATIVE  REORGANIZATION  PLAN 


Reasons  for  Submission  of  Tentative  Reorganization  Plan 

The  reorganization  of  the  fund  on  a  sound  administrative  and  financial 
foundation  is  of  immediate  importance.  Such  reorganization,  however,  is 
surrounded  with  great  difficulties,  especially  from  the  financial  viewpoint. 

The  ^xisting_nine_rnunicipal  pension^funds  cover  by  their  provisions 
)racti£ally  the  entire  municipal  service.  Their  obligations  for  future  pension 
payments  to  pensioners  already  on  the  roll  and  to  those  of  the  present 
employees  who  will  subsequently  retire,  are  now  being  calculated  by  the 
Commission  on  Pensions  and  will  presently  be  published.  In  anticipation  of 
the  completed  results,  the  discounted,  or  "present,"  value  at  4  per  cent,  com- 
pound interest  of  these  future  pension  payments  may  be  estimated  at  about 
$220,000,000. 

As  security  that  pensions  will  be  paid,  the  nine  funds  have  about  $3,000,- 
000  actually  on  hand.  To  this  must  be  added  the  discounted  value  of  future 
city  contributions  of  uncertain  amounts  as  provided  under  existing  charter 
provisions,  and  the  discounted  value  of  future  contributions  of  employees, 
amounting  to  about  $9,000,000. 

The  amount  of  the  difference  between  that  part  of  the  above  assets  which 
consists  of  the  cash  in  hand  and  contributions  of  employees,  and  the  total 
obligations — $208,000,000 — represents  the  discounted  value  of  additional 
amounts  which  the  various  funds  will  require  in  the  future  to  enable  them 
to  meet  the  pension  claims  of  present  pensioners  and  employees  now  in 
service.  The  greater  part  of  this  sum  represents  the  discounted  value  of 
future  mandatory  city  contributions  in  the  form  of  miscellaneous  revenues 
and  direct  deficiency  appropriations,  i.  e.,  a  liability  on  the  part  of  the  city 
and  an  asset  to  the  funds.  The  lesser  part  of  the  $208,000,000  is  the  com- 
bined unprovided  for  deficiency,  or  the  discounted  value  of  amounts  which 
will  be  required  to  supplement  inadequate  future  income. 

While  the  state  legislature  has  not  as  yet  made  the  city  shoulder  this 
deficiency,  which  in  the  case  of  teachers  amounts  to  $54,700,000,  the  experi- 
ence of  the  past  does  not  give  any  assurance  that  it  will  not  do  so  in  the 
future.  For  this  reason,  and  unless  present  laws  are  revised,  the  possible 
extent  of  the  city's  mandatory  and  discretionary  participation  in  the  future 
pension  burden  with  respect  to  present  pensioners  and  employees  alone  is 
indicated  by  its  discounted  value  of  $208,000,000. 

This  condition  indicates  only  in  part  (additional  burdens  in  respect  of 
employees  to  enter  the  service  in  the  future  not  being  considered  in  the  above 
estimates)  the  magnitude  of  the  financial  problem  which  the  Commission  on 
Pensions  is  engaged  in  solving.    The  recommendations  for  a  definite  plan  of 

39 


reorganization  of  the  teachers'  retirement  fund  submitted  in  this  report  are, 
therefore,  subject  to  possible  modifications  in  the  light  of  future  discussion 
of  questions  of  public  policy  regarding  the  entire  pension  problem  of  the 
city.  The  necessity  for  this  reservation  is  further  emphasized  by  the  lack 
of  uniform  and  satisfactorily  tested  standards  in  this  country  and  abroad  for 
the  retirement  of  various  classes  of  municipal  employees. 

Municipal  pension  schemes  in  this  country,  on  account  of  the  wide  dis- 
similarity of  pension  provisions  and  general  condition  of  approaching  or 
actual  bankruptcy,  furnish  in  most  cases  merely  precedents  of  measures 
which  it  is  desirable  to  avoid  in  establishing  a  sound  pension  policy.  This  is 
mainly  due  to  the  comparatively  short  time  the  pension  funds  have  been  in 
operation  and  to  the  lack  of  public  interest  in  efficient  and  equitable  munici- 
pal management  in  the  past. 

In  foreign  countries,  where  pension  schemes  have  been  in  operation  for 
more  than  a  century,  definite  and  sound  pension  principles  have  gradually 
begun  to  be  developed  and  put  into  operation.  This  development  is  not  so 
much  due  to  a  more  intelligent  public  interest  in  municipal  government  as  to 
the  dire  necessity  for  retrenchment  after  pension  schemes  estabhshed  without 
a  definite  idea  of  cost  began  to  be  exorbitant  in  their  demands  on  the  public 
treasury.  Yet,  despite  a  marked  activity,  especially  during  the  last  decade, 
in  the  reorganization  of  a  number  of  foreign  municipal  pension  funds,  there 
is  still  a  regrettable  absence  of  uniformly  accepted  standards  for  the  treat- 
ment of  all  phases  of  the  pension  problem. 

A  pension  scheme,  ideal  in  all  its  details,  does  not  exist,  and  it  remains, 
therefore,  for  those  concerned — the  administration  which,  as  a  representative 
of  the  taxpayer,  is  interested  in  maximum  civil  service  efficiency,  and  the 
employee  who  is  entitled  to  equitable  treatment — to  work  out  and  determine 
through  intelligent  cooperation  a  constructive  pension  policy  which  would 
cure  existing  defects,  secure  beneficial  results,  afford  equitable  treatment 
and,  last  but  not  least,  through  the  adoption  of  sound  financial  methods,  lay 
a  permanent  foundation  for  a  measure  so  essential  to  the  satisfactory  conduct 
of  public  business  and  to  the  general  welfare  of  public  employees. 


Summary  of  Tentative  Suggestions  for  Reorganization 

As  a  substantial  aid  to  constructive  thinking,  and  as  a  practical  means  of 
bringing  forward  differences  of  opinion  regarding  the  general  policy  under- 
lying pension  systems,  a  definite  plan  for  the  reorganization  of  the  teachers' 
retirement  fund  has  been  formulated  on  the  basis  of  such  of  the  existing 
precedents  of  pension  management  as  have  proved  satisfactory  in  operation 
elsewhere  and  appear  to  oflfer  a  satisfactory  remedy  for  existing  local  condi- 
tions. The  constructive  suggestions  set  forth  in  detail  in  the  succeeding 
pages  may  be  summarized  as  follows : 

I.    The  present  law  should  be  repealed  and  a  new  law  passed  which 
will  deal  more  exhaustively  with  all  details  of  provisions  than  the  present 

40 


/ 


law,  and  will  eliminate  as  much  as  possible  the  exercise  of  administrative 
discretion. 

2.  The  administration  and  interpretation  of  the  law  should  be 
entrusted  to  a  board  independent  of  the  Board  of  Education  and  com- 
posed of  members  administratively  and  technically  qualified  for  the  effi-    ' 
cient  performance  of  their  duties.     In  such  board  the  Department  of 
Education  should  be  represented. 

3.  The  liability  to  present  pensioners  should  be  reduced 

/ 

(a)  By  a  revision  of  the  entire  list. 

(b)  By  the  revocation  of  pensions  to  disability  pensioners  no 
longer  disabled. 

(c)  By  the  return  to  duty  of  existing  disability  pensioners  who 
are  cured  of  their  disabilities  and  of  service  pensioners 
who  are  not  superannuated  or  otherwise  disabled. 

(d)  By  a  readjustment  of  pension  benefits  in  accordance  with      / 
the  scale  suggested   for  the  retirement  of   future  bene- 
ficiaries. 

4.  The  fund's  liability  for  future  pensions  to  teachers  now  in  the 
service  should  be  reduced.    A  change  of  existing  provisions  by  the  intro-    ^/ 
duction  of  a  minimum  age  limit  for  retirement  and  other  details  dis- 
cussed in  this  report  will  materially  reduce  the  fund's  present  liability. 

5-    The  future  contributions  of  teachers  now  in  the  service  should 
be  increased  to  cover : 

(a)  One-half  of  the  cost  of  benefits  accruing  for  services  sub-     / 
sequent  to  the  reorganization  of  the  scheme,  and 

(b)  One-half  of  the  cost  of  benefits  accruing  for  services  prior 

to  the  reorganization  of  the  scheme,  except  when  the  total  ' 
annual  contribution  of  individual  teachers  would  exceed  8 
per  cent,  of  salary. 
The  scale  of  contributions  will  vary  according  to  present  age 
and  number  of  years  of  past  service,  and  should,  as  a 
matter  of  expediency,  be  limited  to  a  maximum  of  8  per 
cent,  of  salaries  in  case  of  individual  teachers.  The  con- 
tributions of  teachers  should  be  made  returnable  with 
compound  interest  at  4  per  cent,  upon  separation  from 
service  prior  to  retirement. 

6.  Teachers  entering  the  service  after  reorganization  should  be 
made  eligible  to  retirement  under  the  same  pension  provisions  as  are 
proposed  for  teachers  now  in  the  service.     Their  contributions  should       / 
cover  one-half  of  the  cost  of  their  benefits.    Since  there  are  no  arrears 

to  be  made  good,  the  contributions  of  new  entrants  into  the  system  will 
be  much  smaller  than  those  of  teachers  who  are  nearing  the  period  of 
retirement. 

7.  The  city  should  contribute  annually  a  percentage  of  salaries  of 

41 


teachers  sufficient  to  cover  one-half  of  the  cost  of  benefits  accruing  be- 
cause of  services  subsequent  to  the  reorganisation  of  the  scheme.  Such 
contributions  should  not  be  available  to  employees  leaving  the  service 
prior  to  retirement. 

8.    The  city  should  contribute  a  uniform  amount  annually  for  the 
^         next  60  years  to  liquidate : 

(a)  The  fund's  liability  remaining  for  pensions  on  the  roll  at 
the  time  of  reorganization  of  the  scheme  after  the  list  of 
pensioners  has  been  revised  as  recommended. 

(b)  The  fund's  liability  remaining  for  future  pensions  on 
account  of  services  of  present  teachers  prior  to  reorgani- 
zation after  change  in  benefit  provisions  has  been  made 
and  the  future  contributions  of  teachers  have  been  in- 
creased to  cover  back  services. 

/  9.    The  assets  and  liabilities  should  be  appraised  periodically,  and 

necessary  adjustments  made  in  all  three  contributions. 

Definition  of  Problems  Which  Must  Be  Faced 

Past  experience  of  the  city  with  its  pension  funds  forces  forward  two 
separate  phases  of  the  pension  problem  for  consideration : 

First:  That  pension  provisions  are  not  sound  unless  they  accomplish  a 
definite  purpose,  namely,  assisting  in  obtaining  a  high  standard  of  efficiency 
and  providing  a  certain  means  of  retirement  on  a  just  and  humanitarian 
basis  for  employees  no  longer  able  to  meet  the  demands  of  service- 

Second:  That  pension  provisions,  before  their  adoption,  must  be  calcu- 
lated as  to  cost,  and  such  cost  preferably  met  on  the  reserve,  or  "provide 
for  the  future,"  basis. 

Keeping  these  main  considerations  in  mind,  three  groups  of  persons 
affected  must  be  separately  considered : 

Present  pensioners,  or  1,549  former  teachers  who  have  already  entered 
upon  their  pensions,  have  severed  their  connection  with  their  profession,  and 
who,  because  of  advanced  age,  are,  in  a  good  many  instances,  helpless. 

Active  service,  or  some  21,000  teachers  now  in  the  service  who  have 
entered  upon  their  duties  in  the  expectation  of  a  rather  liberal  pension,  and 
who  have  served  various  periods  of  years,  each  year  of  such  service  carrying 
with  it  a  certain  proportion  of  the  pension  prospect  entertained  at  the  time 
of  employment. 

New  entrants,  or  teachers  to  be  employed  in  the  future,  and  with  whom 
the  city  is  at  liberty  to  make  whatever  pension  arrangements  it  may  consider 
as  most  beneficial  to  the  service. 

Present  Pensioners 

Teachers'  Pensions  Only  Small  Part  of  City's  Total  Pension  Roll 

The  problem  of  making  provision  for  the  continued  payment  of  pen- 
sions to  already  retired  teachers  cannot  consistently  be  considered  without 

42 


taking  into  account  the  total  liability  of  all  pension  funds  for  future  pay- 
ments to  already  retired  city  employees. 

On  December  31,  1914,  there  were  8,232  pensioners  on  the  city's  pension 
roll,  drawing  an  average  annual  pension  of  $624.29,  or  a  total  of  $5,139,166.- 
49.*  The  1,549  pensioned  teachers  with  an  annual  pension  charge  of 
$1,215,231.11  form,  therefore,  only  about  19  per  cent,  of  the  total  number  of 
pensioners  and  about  24  per  cent,  of  the  total  annual  pension  charge. 

The  present  value  of  future  payments  to  these  8,232  pensioners  may 
conservatively  be  estimated,  in  anticipation  of  the  completion  of  actuarial 
calculations,  at  about  $50,000,000.  The  present  value  of  the  1,521  teachers' 
pensions  on  the  roll  on  June  30,  1914,  has  been  ascertained  to  amount  to 
$11,581,210.  The  liquidation  of  this  liability,  against  which  practically  no 
reserves  have  been  accumulated,  presents  a  difficult  and  immediate  problem 
since  neither  the  present  employees  nor  those  to  be  employed  in  the  future 
can  be  expected  to  pay  the  pensions  of  those  already  retired.  Whatever 
arrangements  the  city  may  make  to  provide  the  necessary  amounts,  its  ability 
for  financial  support  of  pensions  to  all  municipal  employees  now  in  service 
and  to  those  who  will  enter  it  in  the  future  will  be  seriously  impaired. 

City  Legally  Unable  to  Furnish  Additional  Aid  to  Present  Pensioners 

The  city's  contributions  to  the  teachers'  retirement  fund  are  restricted 
by  law  to  receipts  from  definite  sources,  such  as  5  per  cent,  of  excise  taxes 
and  unref unded  absence  deductions.  There  is  now,  therefore,  no  way  within 
the  law  whereby  the  city  may  be  obligated  to  contribute,  or  can  of  its  own 
volition  add,  more  to  the  fund  than  the  amounts  accruing  from  the  sources 
defined  by  law. 

City  Should  Reduce  Liability  to  Pensioners  and  Assume  Pa3nnent 

It  must  be  kept  in  mind  that  a  large  proportion  of  the  pensioners  have 
reached  an  advanced  age  and  are,  therefore,  unable  to  adjust  themselves  to 
a  substantial  cut  or  entire  loss  of  income.  The  fact  that  they  have  entered 
upon  their  pensions  relying  on  the  integrity  of  the  fund,  should  also  be  given 
serious  consideration. 

On  the  other  hand,  a  number  of  pensions  have  been  granted  after  less 
than  thirty  years'  service  for  disability  of  a  temporary  character.  No  system 
has  been  established  by  the  Board  of  Education  to  guarantee  the  return  to 
duty  of  those  whose  disability  had  ceased,  and  it  is  conceivable  that  a  num- 
ber of  these  pensioners  should  be  restored  to  active  service. 

It  would  seem,  therefore,  advisable  to  review  the  entire  list  of  pension- 
ers, subdivide  it  into  groups,  according  to  nature  of  retirement  and  present 
age,  and  apply  the  following  procedure  with  respect  to  each  group : 

I.    Pensioners  who  have  retired  for  disability  after  less  than  thirty 
years  and  are  at  present  less  than  65  years  old:  On  September  i,  1915, 

*  See  Table  23,  page  127. 

43 


there  were  273  pensioners  of  this  class  on  the  roll,  drawing  an  average 
annuity  of  $645.05,  or  a  total  of  $176,097.70  per  annum  (see  Table 
21,  page  126).  These  pensioners  should  be  required  to  undergo  a 
physical  examination.  Refusal  to  be  examined  should  result  in  revoca- 
tion of  pension.  Pensioners  who  are  found  to  have  regained  their  health 
should  be  reinstated  to  active  service.  Pensioners  whose  health  is  not 
improved  should  continue  to  draw  their  pensions,  but  should  be  required 
to  be  physically  examined  every  year. 

2.  Pensioners  zvho  have  retired  after  thirty  years'  service  and  are  at 
present  less  than  65  years  old:  In  view  of  the  city's  enormous  obligations 
for  present  pensions,  and  because  of  the  additional  liability  under  various 
existing  provisions  for  past  services  to  present  employees,  it  is  necessary 
to  reduce  pensions  wherever  it  is  possible  to  do  so  on  an  equitable  basis. 
It  is  assumed  that  the  purpose  of  the  retirement  system  is  to  take  care  of 
employees  who  are  no  longer  able  to  continue  in  the  service  and  not  to 
provide  opportunity  for  experienced  teachers  to  leave  the  service  on 
pension  at  the  first  chance.  Taking  the  suggestion  from  the  present  law, 
the  average  teacher  is  presumably  superannuated  at  age  65,  since  the 
Board  of  Education  has  authority,  at  its  discretion,  to  retire  a  teacher 
compulsorily  who  has  reached  that  age.  The  Board  of  Education,  how- 
ever, evidently  considers  that  teachers  as  a  general  rule  can  efficiently 
perform  their  duties  until  they  reach  the  age  of  70,  and  adopted,  on 
December  27,  191 1,  a  by-law  providing  for  compulsory  retirement  of 
teachers  attaining  that  age.  Service  pensioners  under  65,  of  whom  there 
were  612  on  the  rolls  on  June  30,  1914,  should  be  assumed  to  be  able  to 
continue  teaching  and  their  pensions  revoked,  unless  by  physical  exami- 
nation their  inability  to  teach  is  proven. 

3.  Pensioners  less  than  65  years  old  who  are  unable  to  teach  and 
pensioners  65  or  more  years  old:  In  this  group  will  be  all  those  who  are 
either  superannuated  or,  because  of  ill  health,  incapacitated.  The  con- 
tinuation of  their  pensions  would,  therefore,  be  necessary.  It  must, 
however,  be  pointed  out  that  the  scale  of  pensions  is  so  high  as  to  be,  in 
this  respect,  possibly  unique  among  all  teachers'  pension  funds  in  the 
United  States  as  well  as  abroad.*  Pensions  after  30  years  of  service 
range  from  a  minimum  of  $600  to  a  maximum  of  $5,000.  181  pension- 
ers or  1 1.7  per  cent,  of  the  total  number  of  1,549,  receive  $1,000  to  $1,500 
per  annum.  45  pensioners  draw  $1,500  and  less  than  $1,750  per  annum, 
6  between  $2,000  and  $2,500  per  annum,  i  draws  $3,000  and  another 
$5,000  per  annum,  f 


*  But  two  large  cities  in  the  United  States  (besides  New  York  City)  pay  teachers'  pensions 
exceeding  $600.  The  cities  are  Philadelphia,  which  pays  as  high  as  $1,000,  not  exceeding  one-half 
of  final  salary  (minimum  $400),  and  Buffalo,  which  pays  as  high  as  $800,  not  exceeding  half  of 
final  salary.  Besides  giving  materially  smaller  benefits,  both  require  contributions  up  to  2  per  cent, 
of  salary. 

t  See  Table  13,  page  121.  The  pensioner  drawing  $5,000  died  October  14,  1915.  Attention  is 
also  called  to  the  general  increase  in  the  average  amount  of  annuity  granted  during  recent  years, 
as  shown  in  Table  20,  page  125. 


44 


In  view  of  the  extraordinarily  high  pension  scale,  and  the  urgent  neces- 
sity for  economy,  a  reduction  should  be  made  on  some  equitable  basis.*  It 
is  suggested  that  the  pensions  be  graduated  in  accordance  with  the  scale  pro- 
posed for  future  retirements,  i.  e.,  they  should  amount  to  1.25  per  cent. 
(1/80)  of  the  average  salary  during  the  last  10  years  for  each  year  of 
service,  with  a  minimum  of  30  per  cent,  of  such  salary.  The  application 
of  such  a  scale,  as  illustrated  on  pages  56  to  59,  in  the  case  of  eight 
teachers  now  in  service,  will  reduce  principally  the  pensions  of  teachers  who 
have  retired  at  an  early  opportunity,  and  especially  the  recently  granted 
pensions  which  have  been  based  on  salaries  increased  by  the  passage  of 
the  "equal  pay"  law.  On  the  other  hand,  the  pensions  of  teachers  who 
have  retired  after  exceptionally  long  terms  of  service,  exceeding  40  years, 
would  be  slightly  increased. 


Burden  of  Liability  Should  Be  Equally  Divided  Among  Taxpayers  of 
Next  60  Years 

As  a  result  of  the  suggested  revision  of  the  present  pension  list  and  con- 
sequent revocations  and  reductions  in  pensions,  the  total  liability  of  $11,581,- 
210  will,  in  all  probability,  be  reduced.  If  the  city  were  simply  to  assume 
the  fund's  obligations  for  the  payment  of  pensions  as  they  become  due  from 
year  to  year,  the  taxpayers  of  the  next  15  years  would  have  to  carry  more 
than  75  per  cent,  of  the  entire  burden.  The  amounts  payable  each  year  have 
been  calculated,  and  are  presented  in  Table  24,  page  128.  A  summary  of 
the  table,  showing  the  amounts  required  to  be  paid,  beginning  with  the  year 
1914,  in  five-year  periods,  is  presented  below: 


Per 

Aggregate  Cent. 

Amount  of 

Total 


Five  years,  ending  1918. 
1923. 
1928. 
1933. 
1938. 
1943. 
1948. 
1953. 
1958. 
1963. 
1968. 
1973. 


$5,315,511 

32.3 

4,117,335 

25.0 

2,974,974 

18.1 

1,962,878 

11.9 

1,154,043 

7.0 

586,715 

3.6 

249,145 

1.6 

85,116 

.6 

22,654 

.1 

4,550 

.0 

637 

.0 

48 

.0 

$16,473,606  100. 


'  The  scaling  down  of  annuities  of  existing  municipal  pensioners  has  a  number  of  precedents. 
The  Virginia  teachers  have  had  their  pensions  pro  rated,  the  San  Francisco  teachers  receive  only 
50  per  cent,  of  the  amounts  of  the  pensions  granted.  The  Philadelphia  and  Boston  public  school 
teachers'  pensions  can  be  pro  rated,  except  that  in  Boston  no  pension  to  a  teacher  who  has  served 
30  years  shall  be  less  than  $312  a  year.  Provisions  in  industrial  schemes  for  the  scaling  down  of 
pensions  to  bring  them  within  the  resources  provided  are  quite  general. 


45 


Since  the  fund's  liability  to  present  pensioners,  if  it  were  a  legal  obliga- 
tion on  the  part  of  the  city,  would  resemble  a  debt  accumulated  by  several 
generations  in  the  past,  it  would  hardly  be  equitable  to  charge  the  taxpayers 
of  the  next  few  years  alone  with  paying  it.  It  is,  therefore,  suggested  that 
the  fund's  liability  to  present  pensioners  be  added  to  the  unprovided  for  lia- 
bility to  present  teachers  as  explained  on  page  60  and  the  total  discharged 
by  a  uniform  annual  payment  extending  over  a  period  of  60  years.  The 
latter  period  is  suggested  on  the  assumption  that  within  60  years  all  present 
pensioners  will  have  died,  and  the  majority  of  the  present  teachers  will 
have  retired  and  died.* 


Teachers  Now  in  Service 

Discounted  Value  of  Future  Pensions  to  All  Municipal  Employees  Now 
in  Service  Approximately  $170,000,000 

Teachers  are  not  the  only  employees  to  whom  retirement  provisions 
apply  under  present  pension  laws.  The  number  of  employees  in  depart- 
ments having  special  pension  funds  and  of  the  balance  of  the  municipal 
service  covered  by  the  general  provisions  of  the  "Grady  Law"  was  on 
December  31,  1914,  with  exceptions  noted,  as  follows: 

Department  of  Education 21,317t 

Police  Department 10,708 

Street  Cleaning  Department 5,474 

Fire  Department 5,004 

Health  Department 1,256 

College  of  the  City  of  N.  Y 223 

Supreme  Court,  1st  Dept 295 

Supreme  Court,  2nd  Dept 177 

Total  employees  covered  by  special  pro- 
visions   44,454 

Balance  of  municipal  service  covered  by 

the  "Grady  Law" 32,8561: 

Total    employees    in    municipal    service 

covered  by  pension  provisions 77,310 

These  77,000  employees  expect  to  be  retired  on  pensions  if  they  stay  in 
the  service  the  required  length  of  time,  and  in  the  case  of  the  Police,  Fire, 
Health    and    Street    Cleaning    Departments    the    dependents    of    deceased 

*  Municipalities  in  Great  Britain  have  recently  shown  a  marked  activity  in  the  reorganiza- 
tion of  their  pension  funds  on  a  scientifically  sound  financial  basis.  This  requires  a  change  from 
the  "cash  disbursement"  to  the  "reserve"  plan  of  financing  fund  requirements.  The  problem  of 
"accrued"  liabilities,  which  is  the  main  difficulty  in  making  the  change,  is  overcome  by  their  dis- 
tribution in  equal  annual  installments  over  a  period  of  50  to  60  years.  With  the  debts  of  the  past 
settled  in  this  manner,  the  pension  funds  are  enabled  to  make  a  fresh  start  on  a  deficit-proof  basis. 
Liverpool  adopted  such  a  procedure  in  1913,  and  Edinburgh,  Birmingham,  London  and  Manchester 
are    following    suit. 

t  As   of  May   31,    1915. 

J  As  of  June  30,   1914,  excluding  temporary  employees,  and  appointive  and  elective  officers. 

46 


employees  are  entitled  to  pensions  as  well.  The  provisions  vary  in  each 
department  and  are  especially  costly  in  the  Fire,  Police  and  Health  Depart- 
ments. 

The  present  value  of  future  pensions,  under  existing  provisions,  to  teach- 
ers now  in  the  service  has  been  computed  in  the  sum  of  about  $58,000,000. 
A  rough  estimate,  in  anticipation  of  the  results  of  the  actuarial  valuation, 
soon  to  be  completed,  would  place  the  present  value  of  future  pensions  to 
the  remaining  56,000  municipal  employees  at  about  $112,000,000,  making 
the  total  capital  value  of  pensions  to  all  municipal  employees  now  in  service 
approximately  $170,000,000,  in  addition  to  the  $50,000,000  required  to  guar- 
antee payments  to  the  8,232  city  pensioners.  The  vast  extent  of  these 
pension  promises  the  larger  part  of  which,  according  to  present  laws,  the 
taxpayer  is  expected  to  make  good,  must  be  constantly  kept  in  mind  when 
the  ability  of  the  city  to  lend  its  financial  support  for  the  continuation  of  the 
present  pension  provisions  to  active  teachers  as  well  as  all  other  municipal 
employees  is  considered. 

City  Legally  Unable  to  Guarantee  Future  Pensions 

As  in  the  case  of  teacher  pensioners  already  on  the  rolls,  the  city  is 
powerless  to  add  anything  to  the  present  contributions  to  the  fund  in  order 
to  guarantee  the  payment  of  pensions  and  thereby  allow  the  retirement  of 
superannuated  teachers  now  in  service.  The  present  law  has  been  drawn  up 
in  such  a  way  as  to  give  first  claim  to  those  already  retired.  It  continues, 
however,  the  contributions  of  active  teachers  without,  in  any  way,  guarantee- 
ing their  retirement. 

City's  Interest  to  Give  Financial  Support  to  Fund 

The  disadvantages  that  arise  from  the  lack  of  a  proper  retirement  sys- 
tem in  the  civil  service  are  too  widely  known  to  require  any  detailed  argu- 
ment for  the  need  of  providing  pensions  for  superannuated  employees.  The 
need  of  such  provision  being  indisputable,  the  question  of  financial  support 
by  the  city  is  the  next  point  for  consideration.  That  such  support  is  not  only 
advisable  but  unavoidable  with  regard  to  those  now  in  the  service  is  obvious 
from  the  fact  that  a  number  of  active  employees  are  within  a  short  period  of 
superannuation  and  could  not  possibly  in  a  few  years  contribute  enough  to 
retire  on  an  adequate  annuity  of  their  own.  For  this  reason,  even  in  such 
schemes  where  the  entire  cost  or  a  considerable  part  of  it  is  borne  by 
employees  entering  the  service  after  its  establishment,  the  retirement  of  those 
already  in  the  service  is  facilitated  by  contributions  of  the  employer  on 
account  of  back  services. 

City  Must  Protect  Its  Interests  by  Insisting  on  Four  Fundamental 
Conditions 
In  approaching  the  subject  of  provisions  for  the  future  retirement  of 
teachers  now  in  the  service,  the  city  should  at  the  outset  insist  on  certain 

47 


conditions  being  observed  to  prevent  the  pension  system  from  becoming  a 
failure.  The  city's  experience  in  this  respect  is  sufficiently  long  and  costly  to 
know  what  is  to  be  avoided,  and  from  the  experience  of  municipalities  abroad 
which  are  gradually  reorganizing  their  pension  schemes  on  sound  founda- 
tions, object  lessons  are  afforded  for  securing  desired  results. 

In   reorganizing  the  present  teachers'  pension  scheme,   the   following 
provisions  must  be  used  as  a  necessary  foundation : 

1.  The  law  should  be  so  amended  as  to  state  clearly  not  only  the 
main  provisions,  but  all  details  and  deviations  from  the  general  rule : 

(a)  A  service  of  21,000  teachers  of  both  sexes  presents  a 
complicated  number  of  conditions  which  must  be  dealt  with  in  the 
law  as  exhaustively  as  possible  and  not  left  to  the  discretion  of 
the  administration. 

(b)  A  special  clause  should  be  included  in  the  law  providing 
for  a  valuation  of  assets  and  liabilities  at  stated  intervals,  and 
preventing  future  amendments  zvithout  actuarial  estimate  of  the 
financial  effect  of  such  amendments. 

2.  The , administration  and  interpretation  of  the  pension  law  should 
be  entrusted  to  a  body  of  officials: 

(a)  Who  are  not  responsible  to  the  Board  of  Education.  It 
is  wrong  in  principle  and  has  not  worked  well  in  practice  to  im- 
pose semi-judicial  functions  on  those  who  are  interested  in  the 
results  of  their  decisions. 

(b)  Who  have  the  necessary  technical  and  administrative 
qualifications  or  assistance  for  the  efficient  performance  of  their 
duties. 

(c)  Who  may  be  held  responsible  for  all  details  which  enter 
into  the  scientific  management  of  all  pension  funds,  such  as  the 
accumulation  of  vital  statistics,  proper  accounting,  preparation  of 
annual  reports,  keeping  of  pension  records,  etc. 

(d)  Who  should  have  their  own  physicians  for  the  examina- 
tion of  applicants  for  disability  pensions  and  for  the  periodical 
examination  of  pensioners  retired  on  the  ground  of  incapacity. 

Since  the  above  qualifications  have  equal  application  to  pension 
funds  of  other  departments,  it  would  be  obviously  desirable,  from  the 
point  of  view  of  economy  in  management,  and  for  a  uniform  and  im- 
partial interpretation  of  the  present  law  for  the  entire  municipal  serv- 
ice, to  establish  centralized  administration  for  all  city  pension  funds. 
The  board  which  would  be  entrusted  with  the  administration  and  in- 
terpretation of  the  teachers'  pension  law  should,  therefore,  form  a 
nucleus  for  the  future  centralized  board. 

3.  The  pension  provisions  for  teachers  now  in  the  service  should 
be  so  amended  as  to  insure  the  best  interests  of  the  service  by  effective 
elimination  of  the  superannuated  and  incapacitated  and  by  furnishing 

48 


inducement  to  the  efficient  to  continue  in  service.  Above  all,  the  bene- 
fits should  be  adequate  without  being  excessive.  Inadequate  benefits 
do  not  present  a  solution  of  the  pension  problem,  and  their  considera- 
tion does  not  accomplish  practical  results.  The  provisions  should  also 
be  equitable  as  between  individual  teachers,  since  no  benefit  to  the 
service  can  accrue  on  the  basis  of  inequitable  treatment. 

Amendments  on  the  basis  of  benefit  to  service  will  reduce  the 
discounted  value  of  $58,228,550  for  future  pensions  to  teachers  now 
in  service.  If  suggested  changes  in  this  report  be  adopted,  the  fund's 
liability  will  be  reduced  to  $48,227,475.  The  introduction  of  the  pro- 
vision for  the  return  of  teachers'  contributions  will  add  only  $4,105,235 
to  the  above  amount,  making  a  total  of  $52,332,710,  or  a  net  reduction 
of  $5,895,840. 

4.  The  contributions  of  the  city  and  teachers  should  be  sufficient 
to  guarantee  future  pension  payments.  Whether  the  city  or  the  teacher 
should  contribute  the  entire  cost  of  pensions,  or  whether  such  cost 
should  be  borne  by  both,  and  in  what  proportion,  is  one  of  the  most 
difficult  phases  the  pension  problem  has  to  offer.  To  summarize  the 
opinion  of  authorities  on  the  subject,  the  straight,  or  free  pension 
plans,  entirely  financed  by  the  employer  and  the  compulsory  savings 
plans  entirely  financed  by  the  employee  have  the  following  serious 
disadvantages : 

The  straight  pension  plans  are  too  costly.  Though  it  would  appear  at 
first  glance  that  forfeiture  of  pension  rights  in  cases  of  withdrawal  help  to 
reduce  the  relative  cost  of  pensioning  those  who  remain  long  enough  to  be 
retired,  the  evident  injustice  of  such  tontine  features  ultimately  leads  to  the 
adoption  of  arbitrary  and  discretionary  provisions  for  dependents,  and  other 
features,  the  cost  of  which  more  than  offsets  the  economies  gained  from  for- 
feitures. On  the  other  hand,  forfeitures  interfere  with  the  free  discharge  of 
incompetents.  They  are  not  a  sufficient  deterrent  on  the  efficient  employee 
from  seeking  employment  where  the  compensation  for  active  service  is  not 
confused  with  the  question  of  "additional"  and  highly  uncertain  compensa- 
tion in  the  form  of  forfeitable  pensions. 

The  compulsory  savings  scheme  necessitates  too  high  a  tax  on  the 
salaries  of  employees  to  provide  for  adequate  benefits  and  return  of  contribu- 
tions in  the  event  of  withdrawal.  The  amounts  of  accumulated  contributions, 
which  are  considerable  after  a  few  years  of  service  and  may  be  withdrawn 
at  any  time,  are  a  constant  inducement  for  employees  to  leave  the  service, 
which  only  a  few  will  be  able  to  withstand. 

The  experience  of  European  pension  plans  which  are  now  being  reor- 
ganized on  the  basis  of  sound  and  practical  methods,  points  toward  the 
advisability  and  expediency  of  the  share-and-share-alike  method  of  carrying 
the  cost  of  pensions  with  the  employees'  contributions  returnable  and  the 
employer's  contributions  forfeitable  in  case  of  withdrawal  from  service  with- 
out pension. 

49 


It  is  suggested,  therefore,  that  if  the  city  be  financially  able  to  do  so  the 
annual  pro  rata  of  the  pension  cost  for  future  services  of  present  teachers 
should  be  borne  equally  by  the  city  and  the  teachers.  The  deficiency  arising 
from  lack  of  contributions  for  past  services  of  present  teachers  should  be 
borne  in  part  by  the  teachers  themselves  by  raising  their  contributions  on 
account  of  future  services  to  a  reasonable  maximum  and  in  accordance  with 
the  number  of  years  of  service  during  w^hich  no  adequate  contributions  were 
exacted.  The  balance  of  the  deficiency  should  be  discharged  by  the  city  as 
outlined  on  page  60. 


Details  of  Suggested  Pension  Provisions 

The  following  provisions  for  the  retirement  of  teachers  now  in  service 
are  suggested : 

1.  SuperanniMtion  retirement  should  be  made  at  age  of  superannu- 
ation: The  purpose  of  superannuation  provisions  is  to  take  care  of 
teachers  who  are  no  longer  able  to  continue  in  the  service  because  of 
advanced  age.  The  present  method  of  retiring  a,fter  a  period  of  30  years 
of  service  is  an  indirect  means  of  dealing  with  the  superannuation 
problem,  which,  on  account  of  the  low  minimum  age  of  entrance  into 
the  service,  enables  retirement  at  age  48,  and  in  many  instances  results 
in  the  loss  to  the  schools  of  experienced  teachers.  The  better  and  more 
reliable  basis  for  the  determination  of  superannuation  is  the  age  of  an 
employee,  and  has  been  adopted  in  the  majority  of  countries  as  the  main 
condition  for  retirement  on  application.  Age  65  is  almost  universally 
recognized  as  the  age  at  which  the  average  teacher  may  be  supposed  to 
have  passed  the  period  of  reasonable  usefulneess  on  account  of  advanced 
age,  and  is  recommended  as  a  basTs  for  the  retirement  of  New  York 
teachers. 

2.  Superannuation  retirement  should  be  made  compulsory  by  lazu: 
Teachers  should  be  required  by  law  to  retire  at  age  65,  with  the  follow- 
ing qualifications :  Those  who  are  able  to  continue  beyond  this  age  should 
be  allowed  to  remain  in  the  service  upon  satisfactory  physical  examina- 
tion and  the  approval  of  the  pension  board  until  70  years  of  age  is 
reached,  when  retirement  should  be  made  mandatory.  Those  who  are 
superannuated  before  reaching  age  65  may  be  retired  under  the  dis- 
ability provisions. 

3.  Amount  of  pension  should  vary  with  length  of  service  and  aver- 
age compensation:  The  amount  of  pension  should  be  based  on  the 
average  compensation  received  during  the  last  10  years.  1.25  per  cent. 
(1/80)  of  such  compensation  for  each  year  of  service  should  determine 
the  amount  to  be  granted.  The  lo-year  average  basis  would  do  away 
with  the  possibility  of  unwarranted  promotion  of  a  prospective  bene- 
ficiary just  before  retirement  in  order  substantially  to  increase  the 
pension.    Increasing  pensions  in  proportion  to  length  of  service  would 

50 


bring  the  pension  into  a  more  logical  and  equitable  relationship  to 
the  value  of  the  employee's  services  than  the  present  method.  It 
would  serve  as  an  inducement  for  the  employees  to  remain  in  the 
service  as  long  as  they  are  able,  even  beyond  the  retirement  age.  Finally, 
from  the  actuarial  viewpoint,  it  presents  a  satisfactory  and  reliable  basis 
for  calculation. 

4.  Minimum  pension  should  be  fixed  at  30  per  cent,  of  average 
salary:  The  question  of  adequacy  of  pension  makes  the  determination 
of  a  minimum  pension  necessary.  Inadequate  pensions,  i.  e.,  amounts 
which  are  insufficient  to  maintain  a  pensioner  without  additional  income 
from  outside  sources,  are  ineffective  as  a  means  of  elimination  of  the 
superannuated  and  incapacitated  from  the  service,  and  therefore  do  not 
solve  the  pension  problem.  In  the  great  majority  of  instances  teachers 
will,  at  the  rate  of  1.25  per  cent,  of  salary  for  each  year  of  service,  be 
retired  on  adequate  annuities.  For  retirements  after  very  short  periods 
of  service,  in  cases  where  teachers  enter  the  service  at  an  advanced 
age,  or  are  disabled  soon  after  entering  the  department,  a  minimum 
pension  of  30  per  cent,  of  average  salary  is  suggested  (See  illustrations 
on  page  58). 

5.  Teachers  should  pay  arrears  of  contributions  for  "outside" 
experience:  The  present  method  of  crediting  teaching  experience  out- 
side of  the  City  of  New  York  in  determining  eligibility  to  retirement  and 
amount  of  pension  is  unsound,  since  such  teachers  are  not  required  to 
pay  into  the  fund  the  contributions  for  the  period  of  outside  service. 
As  stated  on  page  24,  of  the  total  of  1,521  retired  teachers  on  the  rolls 
on  June  30,  1914,  180  pensioners,  or  11.8  per  cent.,  were  given  credit  for 
"outside"  teaching  experience  in  order  to  make  their  retirement  after  20 
or  30  years'  service  possible  under  present  pension  provisions.  It  is 
suggested  that  teachers  who  had  "outside"  experience  be  required  to 
contribute  the  corresponding  arrears.  This  will  be  accomplished  by 
including  in  their  prior  service  the  period  of  "outside"  experience  and 
charging  them  the  corresponding  rates  on  the  same  basis  as  proposed  for 
other  teachers  (see  pages  176  and  177). 

6.  Special  privileges  to  Hunter  College  staff  should  be  eliminated: 
The  deviations  from  the  general  benefit  provisions  in  favor  of  the  teach- 
ing staff  of  the  Hunter  College  can  hardly  be  justified.  The  evil  and 
costly  consequences  of  special  pension  privileges  lie  in  the  setting  of 
constantly  higher  and  more  expensive  precedents  and  in  creating  dis- 
satisfaction among  those  not  specially  privileged.  It  is,  therefore,  sug- 
gested that  the  retirement  of  the  Hunter  College  staff  be  based  on  the 
same  rules  as  applicable  to  the  rest  of  the  New  York  school  system. 

7.  Excessive  absences  should  not  be  credited  for  pensions:  The 
rules  of  the  Board  of  Education  provide  that  all  absences  of  teachers 
from  duty  should  be  included  in  the  aggregate  period  of  service  entitling 
an  applicant  to  retire.  Under  this  ruling,  a  number  of  teachers  have 
been  given  credit  for  excessive  absences,  ranging  up  to  6  years  and  4 

51 


months.    It  is  suggested  that  excessive  absences  without  pay  should  not 
be  credited  in  fixing  the  amount  of  pension. 

8.  Disability  pensions  should  be  granted  after  a  minimum  service 
of  lo  years:  The  elimination  from  the  service  of  incapacitated  teachers 
is  of  as  much  importance  to  the  efficiency  of  the  service  as  the  elimina- 
tion of  the  superannuated.  Sickness  and  disease  occurring  before  the 
teacher  has  taught  20  years  results  possibly  in  more  hardship  than  after 
a  longer  term  of  service.  The  cost  of  such  pensions  has  probably  been 
the  principal  reason  against  granting  them.  It  may  be  expected,  how- 
ever, that  with  a  stricter  physical  examination  before  retirement  and 
periodical  examination  after  retirement  the  cost  of  disability  pensions 
will  not  be  excessive.  It  is  therefore  suggested  that  the  present  re- 
quirement of  a  minimum  period  of  20  years  of  service  for  eligibility 
to  disability  pensions  be  reduced  to  10  years. 

9.  Amount  of  disability  pension  at  a  lesser  percentage  of  average 
salary  than  superannuation  pension:  The  experience  of  most  pension 
funds  points  to  the  high  cost  of  disability  provisions.  One  of  the  main 
reasons  for  such  cost  lies  in  the  tendency  of  employees  to  retire  before 
superannuation  on  the  ground  of  slight  incapacity,  especially  when  the 
disability  pension  is  granted  on  a  basis  similar  to  that  of  the  superannua- 
tion pension.  It  is  suggested  that  a  lesser  percentage  of  salary  be 
allowed  for  each  year  of  service  than  the  percentage  allowed  for  the 
superannuation  pension.  Disability  pensions  should  be  calculated  at  the 
rate  of  i  per  cent,  of  the  average  compensation  of  the  last  10  years  for 
each  year  of  service.  It  is  believed  that  such  arrangement  will  insure 
bona  fide  disability  retirements  and  offset  their  greater  cost. 

10.  Applicants  for  disability  pensions  should  be  examined  by 
physicians  of  pension  board:  It  is  suggested  that  no  pensions  on  the 
ground  of  disability  should  be  granted  unless  such  disability  is  certified 
by  physicians  of  the  pension  board.  Such  physicians  should  not  be 
under  the  jurisdiction  of  the  Board  of  Education,  nor  should  they  be 
allowed  to  practice  privately  among  teachers. 

11.  Disability  pensioners  should  be  periodically  examined  after 
retirement:  Teachers  retired  on  the  ground  of  disability  should  be 
required  to  undergo  annually  an  examination  by  the  physicians  of  the 
pension  board.  If  a  pensioner  is  found  to  have  regained  health,  the 
pension  should  be  discontinued  and  return  to  active  duty  should  be 
required. 

Details  of  Contributions  by  Teachers 

The  cost  of  the  provisions  suggested  in  the  preceding  pages  has  been 
calculated  and  the  contributions  required  on  the  part  of  the  teachers  now 
in  service  determined  as  follows: 

I.  Teachers  should  contribute  half  of  sum  required  for  pensions 
accruing  for  future  services:  The  share-and-share-alike  principle 
appeals  to  logic  as  an  equitable  method  for  distributing  the  cost  of  a 

52 


scheme  from  which  both  parties  are  to  benefit.  It  is  on  this  basis  that 
teachers  now  in  service  should  contribute  their  pro  rata  share  of  pen- 
sions accruing  because  of  future  services. 

2.  Teachers  should  help  discharge  deficiency  because  of  hack 
services:  The  contributions  on  the  part  of  teachers  now  in  service 
have  been  insufficient  to  cover  any  considerable  part  of  the  pensions 
accruing  on  account  of  past  services.  If  the  share-and-share-alike 
principle  is  adopted,  it  would  be  equitable  for  the  city  to  expect  the 
teachers  to  make  up  half  of  the  resulting  deficiency  while  the  city 
makes  provision  for  the  payment  of  the  other  half.  It  must  be  pointed 
out,  however,  that  a  number  of  teachers  are  very  near  the  retirement 
age  and  the  deductions  required  to  make  up  for  insufficient  contribu- 
tions would  prove  excessive.  It  is,  therefore,  advisable  to  increase  the 
percentage  deductions  required  for  meeting  half  of  the  cost  of  pen- 
sions accruing  for  future  services  by  additional  percentage  deductions 
for  meeting  half  of  the  cost  of  pensions  accruing  for  past  services, 
setting,  however,  a  limit  of  8  per  cent,  of  salary  as  a  matter  of  ex- 
pediency, 

3.  Separate  rates  of  contributions  should  apply  to  men  and  women 
teachers:  The  experience  of  the  pension  fund  in  the  past  has  demon- 
strated the  fact  that  the  pensions  of  men  teachers  cost  less  than  those 
of  women  teachers,  mainly  because  their  mortality  rates  are  higher  as 
compared  with  those  observed  among  women  teachers.  In  the  interest 
of  equity,  therefore,  the  rates  of  contributions  of  men  teachers  should 
be  lower  than  those  to  be  applied  to  women  teachers. 

4.  Contributions  based  on  present  age  and  years  of  service  prior 
to  reorganization:  The  salary  deductions  required  to  be  made  on  the 
basis  explained  in  the  three  preceding  paragraphs  have  been  calculated 
according  to  age  at  time  of  reorganization,  i.  e.,  "present"  age  and 
years  of  completed  service.  The  rates  for  men  and  women  teachers 
are  presented  in  detail  on  pages  176  and  177.  The  deductions,  expressed 
in  percentages  of  salary,  required  for  teachers  who  have  reached  the 
ages  and  completed  the  number  of  years  of  service  indicated  below 
are  as  follows : 

MEN    TEACHERS 

Years  of  Service  Prior  to  Reorganization 


Age  at  Reorganization 


2 

Yrs. 


7 
Yrs. 


12 

Yrs. 


17 

Yrs. 


22 

Yrs. 


27 
Yrs. 


37 
Yrs. 


20 

2.63 

25 

2.68 

30 

2.82 

35 

3.05 

40 

3.36 

45 

4.06 

50 

5  93 

55 • 

56  and  above 

3.00 
3.19 
3.50 
3.92 
4.53 
5.93 
8.00 


3.56 
3.96 
4.51 
5.30 
6.61 
8.00 
8.00 


4.42 
5.10 
6.09 
7.76 
8.00 
8.00 


5.71 
6.90 
8.00 
8.00 
8.00 


7.73 
8.00 
8.00 
8.00 


.00 


53 


WOMEN   TEACHERS 


Years  of  Service  Prior  to  Reorganization 


Age  at  Reorganization 


2 
Yrs, 


7 
Yrs. 


12 

Yrs. 


17 

Yrs. 


22 

Yrs. 


27 
Yrs. 


37 

Yrs. 


20 2.87  

25 3.17  3.49         

30 3.55  3.91  4.32 

35 4.07  4.54  5.02         5.52 

40 4.78  5.40  6.04        6.69 

45 5.63  6.17  7.06        7.97 

50 7.47  7.47  8.00        8.00 

54  and  above 8.00  8.00        8.00 


In  order  to  illustrate  the  application  of  the  above  rates  to  teachers 
already  in  the  service,  let  us  take,  for  instance,  a  woman  teacher  who 
has  reached  age  40  at  the  time  the  suggested  plan  goes  into  effect.  If 
she  has  had  12  years'  service,  she  will  be  required  to  contribute  6.04 
per  cent,  of  her  salary  as  long  as  she  remains  in  the  service,  and  her 
contributions  will  be  sufficient  to  provide  one-half  of  the  contemplated 
benefits.  Another  woman  teacher  who  has  had  also  12  years  of  service, 
but  who  is  54  years  old  at  the  time  of  reorganization,  would  have  to 
contribute  8  per  cent,  of  salary  for  the  remaining  years  of  her  service. 
The  contribution  required  on  her  part  to  pay  one-half  of  the  benefits 
allowed  by  the  suggested  scheme  would  have  necessitated  the  deduc- 
tion of  10.6  per  cent,  of  her  salary,  as  shown  on  page  177,  On  account 
of  the  hardship  entailed  in  requiring  excessively  high  contributions, 
these  are  limited  to  8  per  cent,  of  salary.  The  remaining  2.6  per  cent,  of 
salary  in  this  case,  therefore,  would  be  contributed  by  the  city. 

An  approximate  idea  of  the  number  of  teachers  who  would  be 
required  to  pay  different  contribution  rates  may  be  formed  from  the 
following  statement,  prepared  according  to  the  distribution  of  the  teach- 
ing force  by  age  and  prior  service,  on  June  30,  1914: 


Percentage  of  Salary  Required  as 
Contribution 


Men 
Teachers 


Number 


Per 

Cent 

of 
Total 


Women 
Teachers 


Number 


Per 
Cent 

of 
Total 


Total  Teach- 
ing Force 


Number 


Per 
Cent 

of 
Total 


Less  than  3% 

3%  and  less  than  4% 
4%    "       "       "    5% 

5%    ' 6% 

6%  "  "  "  7% 
7%  "  "  "  8% 
8% 

Total 


474 
997 
509 
160 
106 
59 
303 


18.2 

38.2 

19.5 

6.1 

4.1 

2.3 

11.6 


3,233 
4,262 
3,464 
2,457 
588 
1,410 
2,566 


18.0 
23.7 
19.3 
13.7 
3.3 
7.8 
14.2 


3,707 
5,259 
3,973 
2,617 
694 
1,469 
2,869 


18.0 
25.6 
19.3 
12.7 
3.4 
7.1 
13.9 


2,608 


100.0 


17,980 


100.0 


20,588 


100.0 


54 


The  distribution  of  the  teaching  force  at  the  date  of  reorganiza- 
tion will  be  practically  the  same  as  that  existing  on  June  30,  1914.  As 
shown  above,  the  majority  of  teachers,  or  62.9  per  cent,  of  their  total 
number,  would  be  required  to  contribute  less  than  5  per  cent,  of  salary. 
Contributions  of  5  per  cent,  and  less  than  8  per  cent,  of  salary  would 
be  made  by  23.2  per  cent,  of  the  force.  Only  13.9  per  cent,  of  the  total 
number  of  teachers,  a  group  consisting  of  those  who  would  soon  become 
eligible  for  retirement,  would  contribute  at  the  maximum  rate  of  8  per 
cent,  of  salary.  These  high  contributions  would  therefore  be  required 
for  only  a  comparatively  short  time. 

5.  Contributions  of  teachers  should  be  returned  in  case  of  zvith- 
drawal:  It  is  suggested  that  the  contributions  of  teachers  should  be 
refunded,  with  accumulations  of  compound  interest  at  4  per  cent.,  in 
case  of  death,  resignation  or  dismissal.  These  refunds  are  in  the 
nature  of  additional  benefit  provisions,  and  naturally  require  larger 
contributions  than  would  be  necessary  if  teachers  leaving  the  service 
before  becoming  eligible  to  pension  were  to  forfeit  the  amounts  they 
had  paid  into  the  fund.  The  refund  provision  has  been  taken  into  con- 
sideration in  calculating  the  rates  of  contributions  just  presented,  be- 
cause the  failure  to  make  refunds  generally  leads  to  dissatisfaction 
among  employees  and  interferes  with  the  discharge  of  inefficient  em- 
ployees before  they  are  eligible  to  pension.  It  is  also  assumed  that 
the  return  of  contributions  with  compound  interest  will  be  considered 
as  an  attractive  savings  arrangement  by  the  younger  teachers,  who 
constitute  the  majority  of  the  teaching  force,  and  who  would  otherwise 
probably  consider  it  a  great  hardship  to  make  increased  contributions 
for  a  remote  benefit  which  they  do  not  expect  to  claim. 

Application  of  Provisions  Illustrated  by  Eight  Individual  Cases 

To  illustrate  the  application  of  the  suggested  provisions  governing 
benefits  and  contributions  in  individual  cases,  eight  teachers  now  in  the 
service  have  been  selected.  Six  of  these  teachers,  of  various  ages,  lengths 
of  prior  service  and  grades  of  compensation,  are  credited  only  with  expe- 
rience in  local  schools,  while  the  remaining  two  teachers  have  entered  the 
local  school  system  with  credit  for  outside  teaching  experience  of  7  and 
13  years,  respectively.  The  past  record  of  these  teachers  has  been  supple- 
mented by  an  estimate  of  future  promotions  under  the  present  salary 
schedules.  The  combined  "actual"  past  and  "estimated"  future  experience 
is  presented  on  pages  129  to  133,  under  the  identification  letter  "A"  to  "H.^' 

Superannuation  Retirement,  and  Contributions 

On  the  basis  of  the  individual  records  of  the  eight  teachers,  the  details 
of  their  eventual  retirement  at  age  65  and  the  required  contributions  have 
been  compiled  in  the  following  statement: 

55 


^S 

S  c  c  c  h 

OOCOOOOOO 

CO-*(N'*T-tO'00 

O 

t^^Tj^OCldotN' 

(N(M(NiO00(M00»O 

a, 

«^                        ,_(,_i  (M 

a 

."x       ^-^ 

O 

O 

^bwl.^ 

CO        CO 

OS       o 

S^  G  a  > 

Ph   O       (^  O 

OG0»-HO'*OOO 

t^OJi-Ht^OiO-^O 

w 

<M(Nf0TjH»O00r^00 

u 

hH 

> 

.  o 

fSj 

-ta  a^. 

Ui 

g2b 

lOOOOOiOiOO 

o 

TtllCCOiOiO-^lO 

o 

55 

% 

^ 

COOOt^O»OGCO 

Ph 

-4-3 

coooeo>o<Nooo 

:3 

lOO'-H'*(N'-Hl-((N 

o 

e0(MO(MO0C05CC 

U 

g 

iO_C0_O_-*_00  00  IM^t>;_ 

W 

< 

t-rT-Ti-Ti— 1          i-Tt-h" 

u 

^ 

< 

td 

H 

-J-3 

oooooooo 

H 

oooqqooo 

K 

o  <6>  (Zi  ^  <z>  <Zi  <6i  <z> 

o 

iOO(MiOOOiOO 

i-H_Tj<_Qq^(Oicio^co^io^ 

3 

co~(N'~.-rc<rT-r,-r(N"co" 

P^ 

« 

«# 

O 

LO 

^  o  52  c  S 

oooooooo 

>< 

PS 

oooooooo 
oddddd  o'lo 

< 

hj 

lOOlMiOOOiOO 

CO 

< 

, 

H 

OOOOOOOO 

oooqqoqq 

g 

O  C^  GO  o  o  o  o  ^ 

u 

0_^t^  t^  (N^lO^lO^lO^rH^ 

M 

i-T       i-ri-ri-r(M''cc" 

€^ 

H 

'o 

s§ 

t) 

> 

•^^  o 

O-^rJHeOOt^OO 

CC^^'^'^'^CC*^ 

^    g< 

fe 

CO 

§2 

o 

O  S  G 

ss 

J 

0)   tuO-S 

(M^fOrHOOi-'t^i-H 

1— 1  1-H  CO  I— 1  fCl 

Q 

00(NTt<fOt^05COO 

(N(M(MCOCO'<*<'*»0 

<Q^.2 

^_^ 

11^ 
aj  rt  1^ 

3                     -5- 

-a  OhJ 

hH 

66 


Teachers  "A"  to  "H"  will  have  served  a  varying  period  of  39  to  47 
years  before  retiring  at  age  65,  and  will  receive  accordingly  a  varying  ratio 
of  48.75  per  cent,  to  58.75  per  cent,  of  their  average  salary  for  the  ten 
years  preceding  retirement,  in  pensions.  It  will  be  noticed  that  the  lo-year 
average  salary  is  identical  in  all  cases,  but  one,  with  the  last  salary  received 
at  the  date  of  retirement.  This  approximately  reflects  the  actual  conditions 
of  promotion  under  the  present  practice.  The  recommended  lO-year  aver- 
age salary  basis  for  pensions  will  have  practical  effect  in  case  of  general 
automatic  increases  in  salary  schedules. 

The  rates  of  contributions  which  will  be  required  in  the  eight  indi- 
vidual cases  included  in  the  statement  vary  from  2.76  per  cent,  to  the  recom- 
mended 8  per  cent,  maximum  of  salary.  They  depend  on  the  sex  of  the 
teacher,  present  age  and  years  of  service  prior  to  reorganization,  as  shown  in 
detail  on  pages  176  and  177.  Teachers  "A,"  "B"  and  "C"  will  contribute  the 
lowest  rates — 2.76  per  cent,  to  3.1 1  per  cent,  of  salary — shown  in  the  state- 
ment. They  have  entered  the  service  comparatively  early  in  life,  and  on  ac- 
count of  short  periods  of  prior  service  will  not  be  called  upon  to  make  up 
large  arrears  in  contributions.  Teachers  "D,"  "E"  and  "F,"  although  they  also 
entered  the  service  early  in  life,  have  to  make  up  comparatively  large  arrears 
in  contributions,  as  they  have  been  in  service  11,  18  and  31  years,  respect- 
ively. This  explains  the  higher  rates  of  4.70  per  cent.,  5.94  per  cent,  and 
8  per  cent,  of  salaries  required  in  contributions  on  their  part.  Teacher 
"F,"  with  31  years'  prior  service,  would  have  been  required  to  pay  12.96 
per  cent,  of  her  salary  were  it  not  for  the  8  per  cent,  limitation  clause.  The 
4.96  per  cent,  shortage  in  her  contributions,  however,  will  be  paid  by  the 
city  and  not  made  a  charge  on  other  teachers. 

The  prior  service  of  teachers  "G"  and  "H"  includes  credit  for  "out- 
side" experience  of  7  and  13  years,  respectively.  The  rates  which  they 
are  required  to  pay  to  the  fund  are  7.46  per  cent,  and  8  per  cent,  of  their 
salaries,  and  include  arrears  in  contributions  for  the  entire  period  of  pre- 
vious service,  including  "outside"  experience.  This  is,  however,  only  par- 
tially true  in  the  case  of  teacher  "H,"  who  would  have  been  required  to 
contribute  21.03  P^^  cent,  of  his  salary  were  it  not  for  the  8  per  cent, 
limitation  clause. 


Disability  Retirement 

Retirement  for  disability  is  provided  for  in  the  proposed  plan  on  the 
basis  of  I  per  cent,  of  average  salary  of  10  years  preceding  retirement  for 
each  year  of  service,  with  a  minimum  limitation  of  30  per  cent,  of  average 
salary.  The  following  statement  shows  the  pensions  which  would  be 
granted  to  the  eight  teachers  under  consideration  should  they  be  retired  for 
disability  after  the  indicated  periods  of  service: 


57 


10  Years 

20  Years 

30  Years 

40  Years 

Identification 
Letter 

Amount 

%of 
Avge. 
Salary 
of  10 
Years 

Amount 

%of 
Avge. 
Salary 
of  Last 
lOYrs. 

Amount 

%of 
Avge. 
Salary 
of  Last 
lOYrs. 

Amount 

%of 
Avge. 
Salary 
of  Last 
lOYrs. 

A 

$457.60 
316.20 
266.40 

30  (a) 
30(a) 
30(c) 

$926.10 
715.50 
510.00 
493.80 
395.40 

30  (a) 
30  (o) 
30(c) 
30  (c) 
30  (c) 

$945.00 
720.00 
546.00 
781.50 
450.00 

30 
30 
30 
30 
30 

B 

C 

D 

$960.00 
728.00 

1,060.00 
600.00 
600.00 

40 
40 
40 

E 

40 

F 

40 

G 

606.00 

30(c) 

795.00 

30 

H 

1,386.00 

40 

The  blank  spaces  in  the  above  statement  indicate  that  disability  retire- 
ment for  the  corresponding  periods  of  service  is  inapplicable.  Teachers 
"A'^  and  "G,"  having  entered  the  service  at  the  age  of  26,  will  have  reached 
age  65  after  39  years  of  service  and  become  eligible  to  retirement  under 
the  superannuation  provisions.  The  disability  clause,  therefore,  is  not  ap- 
plicable to  them  after  a  service  of  40  years.  On  the  other  hand,  the  blank 
spaces  for  teachers  "D,"  "E/'  "F"  and  "H"  in  the  10  to  30  year  columns 
show  that  they  have  passed  the  corresponding  service  periods. 

The  application  of  the  30  per  cent,  minimum  pension  limitation,  as 
indicated  in  the  statement  by  reference  to  a  footnote,  affects  all  estimated 
pensions  in  the  first  two  columns.  An  idea  of  its  operation  is  facilitated 
by  the  following  comparison  of  the  disability  pensions  to  which  teachers 
"A,"  "B"  and  "C"  would  be  entitled  after  10  years  of  service  with  and 
without  the  30  per  cent,  minimum  limitation : 


Teachers 


Pension  of 

Pension  of 

10  Per  Cent 

30  Per  Cent 

Average 

Average 

Salary 

Salary 

A $152.50 

B 105.40 

C 88.80 


$457.50 
316.20 
266.40 


Teachers  who  are  unable  to  continue  teaching  after  30  years  of  service 
will  be  enabled  to  retire  under  the  proposed  disability  clause  on  compara- 
tively comfortable  allowances.  Those,  however,  who  remain  in  the  service 
until  age  65  will  receive  their  full  allowances,  justly  due  them,  in  accordance 
with  length  of  service  and  salary.  The  estimated  pensions  which  would  be 
granted  under  these  two  assumptions  to  the  teachers  indicated  below  are 
as  follows: 


(a)  Pension  amounts  to  less  than  30  per  cent.,  but  fixed  at  that  rate  as  a  minimum. 

58 


A. 
B. 
C. 
D. 
E. 
G. 


Teachers 


Disability 
Pension 

Superannua- 
tion Pension 

After  30 

at 

Years'  Service 

Age  65 

$945.00 
720.00 
546.00 

$1,535.63 
1,320.00 
1,001.00 

781.50 

1,424.37 

450.00 

862.50 

795.00 

1,291.88 

Return  of  Contributions 

The  proposed  plan  provides  for  the  return  of  the  teacher's  contribu- 
tions with  4  per  cent,  compound  interest  in  case  of  resignation,  dismissal 
or  death.  This  provision  will  be  welcomed  in  view  of  the  proposed  rates 
of  contributions,  which  are  higher  than  the  flat  i  per  cent,  of  salary  required 
under  the  present  plan.  The  contributions  required  from  the  eight  teachers 
selected  for  purposes  of  illustration,  and  the  amounts  which  will  be  re- 
funded in  the  event  of  their  leaving  the  service  prior  to  retirement  are 
shown  in  the  following  statement  at  intervals  of  five  years  each,  after  the 
date  of  reorganization : 


c 

o 
•^  ir! 

Years  of 
Service 
Remain- 
ing 
Before 
Retire- 
ment at 
Age  65 

Contributions 

Return   of   Contributions   with   Interest   in 
Case  of  Resignation,  Dismissal  or  Death 

t-4 

Per  Cent,  of 

Salary 

During 

Remainder 

of  Service 

Amount 

per 
Annimi 

from 
Present 
Salary 

5  Years 

After 
Reorgan- 
ization 

10  Years 

After 
Reorgan- 
ization 

20  Years 
After 

Reorgan- 
ization 

30  Years 

After 
Reorgan- 
ization 

40  Years 

After 
Reorgan- 
ization 

A 

37 
43 
41 
32 
28 
16 
22 
9 

2.76 

2.98 

3.11 

4.70 

5.94 

8.00   (12.96) 

7.46 

8.00   (21.03) 

$27.60 

21.46 

24.26 

56.40 

89.10 

120.00 

186.50 

252.00 

$217.29 
136.34 
163.83 
378.91 
491.30 
661.68 
1,090.13 
1,544.32 

$620.94 

420.48 

448.15 

989.40 

1,088.98 

1,466.64 

2,416.44 

$1,982.15 
1,496.82 
1,351.70 
2,976.79 
2,700.98 

$3,997.11 
3,090.08 
2,692.64 
5,928.86 

B... 
C... 
D 

$5,548.48 
4,677.69 

E 

F 

G 

5,993.44 

H 

City's  Contributions  on  Account  cf  Teachers  Now  in  Service, 

As  shown  on  page  174,  the  present  value  of  the  suggested  pension 
and  refund  benefits  to  prospective  beneficiaries  of  the  present  force 
amounts  to  $52,332,710.  The  present  value  of  the  suggested  future  con- 
tributions of  the  teachers  is  $22,108,950,  which  is  less  than  one-half  of 
the  total  because  of  the  limitation  of  such  contributions  to  8  per  cent,  of 
salary  in  individual  cases. 


59 


In  discharging  the  remaining  liability  of  $30,223,760,  the  city  should 
make  a  distinction  between  contributions  required  on  account  of  future 
and  past  services  of  teachers. 

The  calculations  show  that  annual  contributions  of  about  3  per  cent, 
of  the  salaries  of  present  teachers  will  be  required  to  provide  for  one-half  of 
the  cost  of  benefits  on  account  of  their  future  services.  These  contribu- 
tions are  in  the  nature  of  current  obligations  and  should  be  currently  dis- 
charged. They  will  amount  to  $866,710  during  the  first  year,  decreasing 
annually  in  accordance  with  the  separation  of  the  present  teachers  from 
the  service.  The  present  value  of  these  future  city  contributions  has  been 
ascertained  to  be  $13,022,825. 

Having  made  provision  for  the  discharge  of  current  demands,  the 
city  should  adopt  an  equitable  means  of  liquidating  its  share  of  the  lia- 
bility for  future  pensions  on  account  of  the  services  of  present  teachers 
prior  to  the  proposed  reorganization  of  the  pension  fund.  This  liability 
will  amount  to  $17,200,935,  and,  as  in  the  case  of  the  future  cost  of  present 
pensions,  is  in  the  nature  of  debts  accumulated  in  the  past. 

It  is  proposed,  therefore,  to  add  this  charge  to  the  charge  for  pen- 
sions already  granted  and  to  discharge  the  total  sum,  amounting  to 
$27,899,430,  by  means  of  uniform  appropriations  of  $1,233,220  annually 
during  the  next  60  years. 

The  above  suggestions  are  offered,  however,  on  the  assumption  that 
the  city  will  be  financially  able  to  assume  at  the  present  time  the  somewhat 
heavy  annual  burden.  If  this  should  not  be  the  case,  another  alternative 
method  of  dealing  with  the  deficiency  may  be  adopted  as  outlined  on  page  69. 


New  Entrants 

City's  Retirement  Problem  Not  Limited  to  Teachers 

In  approaching  the  task  of  formulating  provisions  for  the  retirement 
of  "new  entrants,"  i.  e.,  teachers  to  be  employed  subsequent  to  the  pro- 
posed reorganization  of  the  present  plan,  it  is  advisable,  as  in  the  case  of 
present  pensioners  and  teachers  now  in  service,  to  consider  the  entire  scope 
of  the  city's  problem. 

The  need  of  retirement  provisions  is  not  peculiar  to  teachers  alone, 
but  applies  to  the  entire  municipal  service.  In  the  interest,  therefore,  of 
efficiency  and  equal  justice,  the  city's  interest  in  the  employees  of  one 
department  should  be,  under  like  conditions  of  employment,  the  same  as 
in  the  employees  of  another  department.  This  principle  of  impartiality 
should  be  especially  observed  in  framing  pension  provisions  for  employees 
to  enter  the  city's  service  in  the  future.  The  absence  of  legal  or  moral 
obligation  on  the  part  of  the  city  for  prior  services  under  existing  pension 
laws  makes  the  task  comparatively  easy,  especially  from  the  viewpoint  of 
cost,  since  there  are  no  accrued  liabilities  to  be  considered. 

60 


Benefit  Provisions  Suggested  for  Present  Teachers  to  Apply  Also  to 
New  Entrants 

The  arguments  used  in  the  discussion  of  benefit  provisions  contem- 
plated for  teachers  now  in  service  apply  with  equal  force  to  teachers  to  be 
employed  in  the  future,  and  the  details  of  such  provisions  presented  on 
the  preceding  pages  are,  therefore,  suggested  for  the  future  retirement  of 
new  entrants. 


New  Entrants  Required  to  Contribute  at  Lower  Rates  Than  Present 
Teachers 

The  principle  of  share-and-share-alike  contributions  on  the  part  of 
employees  and  the  city  toward  the  cost  of  suggested  benefits  should  also 
be  adopted  for  new  entrants.  As  there  is  no  necessity  for  making  provision 
for  arrears  on  account  of  services  rendered  in  the  past,  the  contributions 
required  from  new  entrants  are  much  lower  than  those  suggested  for  teach- 
ers already  in  the  service.  They  are  based  on  age  at  entrance  into  the 
service,  and  remain  uniform  at  the  same  percentage  of  salary  throughout 
the  entire  period  of  service.  The  detail  contributions  suggested  for  women 
and  men  teachers  according  to  age  at  entrance  into  the  service  are  presented 
on  page  175  of  the  actuarial  report.  The  following  summary  table  gives 
the  rates  of  contributions  expressed  in  percentages  of  salary  which  are 
required  from  teachers  entering  the  system  at  the  ages  specified  below : 


Men  Teachers 

Women  Teachers 

En- 
trance 
Age 

For 
Service 
Pension 

For 
Disa- 
bility 
Pension 

For_ 
Returning 
Contri- 
butions 
on  With- 
drawal or 
Death 

Total 

For 
Service 
Pension 

For 
Disa- 
bility 
Pension 

For 
Returning 
Contri- 
butions 
on  With- 
drawal or 
Death 

Total 

20 
25 
30 
35 
40 

1.98 
2.07 
2.20 
2.40 
2.63 

.19 
.19 
.21 
.23 

.27 

.35 
.30 
.27 
.24 
.23 

2.52 
2.56 
2.68 
2.87 
3.13 

1.70 
1.95 
2.21 
2.50 

2.87 

.53 

.64 

.79 

1.01 

1.29 

.53 
.46 
.40  f 

.37  r 

.37  Ki 

2.76 
3.05 
3.40 
3.88 
4.53 

City  Should  Contribute  Currently  on  Account  of  New  Entrants 

The  above  rates  cover  one-half  of  the  cost  of  suggested  benefits,  the 
other  half  should  be  provided  for  by  annual  city  appropriations  equal  to  the 
contributions  of  new  entrants.  These  contributions  will  be  equal  to  about 
3  per  cent,  of  the  total  salaries  of  new  entrants.  The  amounts  will  be  small 
in  the  beginning  and  increase  from  year  to  year  as  the  present  teachers 
leave  the  service  and  are  replaced  by  new  entrants.  When  all  present 
teachers  will  have  left  the  service,  the  entire  teaching  force  will  consist  of 

61 


those  who  entered  the  department  after  reorganization  and  the  contribu- 
tions of  the  city  on  their  behalf  will  equal  about  3  per  cent,  of  the  entire 
payroll,  remaining  stationary  at  the  same  percentage  and  increasing  in 
amount  according  to  payroll  increases  of  the  department. 

Comparative  Cost  of  Present  and  Proposed  Benefits  Shown  by  Total 
Contributions  Required  of  New  Entrants 

A  comparison  of  the  relative  cost  of  the  present  and  proposed  pension 
plans  is  facilitated  by  the  consideration  of  the  payments  required  on  account 
of  new  entrants  to  cover  the  cost  of  future  benefits  allowed  under  the  two 
plans.  For  this  purpose  the  total  rates  or  the  amounts,  expressed  as  a  per- 
centage of  the  employee's  salary,  which  will  be  sufficient  to  provide  similar 
benefits  under  both  plans  are  presented.  They  do  not  take  into  account 
the  method  by  which  the  cost  is  apportioned  between  the  city  and  the 
employees. 

Service  or  Superannuation  Pension 

The  following  rates  show  the  cost  of  the  proposed  superannuation 
pension  at  age  65  of  i^  per  cent,  of  average  salaries  of  last  10  years  for 
each  year  of  service  as  compared  with  the  cost  of  the  present  service  pen- 
sion of  one-half  final  salary  after  30  years'  service: 


Age  at  Entrance 

Men 

Teachers 

Women  Teachers 

Present 
Plan 

Proposed 
Plan 

Present 
Plan 

Proposed 
Plan 

20.... 
25... 
30.... 
35.... 
40.... 

. ..     3.05 
. ..     3.50 
, ..     3.96 
, ..     4.20 
. ..     3.89 

3.97 
4.13 
4.41 
4.80 
5.26 

5.08 
6.12 
6.54 
6.16 
5.16 

3.41 
3.90 
4.43 
5.01 
5.74 

These  rates  show  that  the  proposed  plan  is  slightly  more  costly  in  the 
case  of  regular  pensions  for  men  teachers  than  the  present  one.  This  is 
explained  by  the  fact  that  under  the  present  plan  the  average  man  teacher 
does  not  retire  until  after  age  65,  while  the  proposed  plan  calls  for  com- 
pulsory retirement  at  that  age.  The  rates  under  the  present  system  increase 
according  to  age  at  entrance  during  younger  ages  to  a  certain  point  only. 
Their  decrease  after  this  point  is  due  to  the  fact  that  employees  must  serve 
30  years  before  retiring,  and  consequently  those  entering  at  advanced 
ages  cannot  retire  until  they  have  become  quite  old,  when  the  cost  of  pen- 
sion is  reduced.  But,  under  the  proposed  plan,  as  the  age  of  retirement  is 
fixed,  the  older  the  employee  at  entrance  the  shorter  his  period  of  contri- 
bution, and  consequently  the  higher  his  rate. 

62 


Disability  Pension 

The  rates  shown  below  are  required  to  cover  the  cost  of  the  proposed 
disabihty  pension  of  i  per  cent,  of  average  salary  of  last  lo  years  for  each 
year  of  service  (minimum  30  per  cent.)  after  any  period*  of  service  as 
compared  with  the  present  disability  pension  of  one-sixtieth  of  final  salary 
for  each  year  of  service,  after  20  years  of  service: 

Men  Teachers  Women  Teachers 


Age  at  Entrance  Present  Proposed  Present  Proposed 

Plan  Plan  Plan  Plan 

20 0.40  0.38  1.41  1.07 

25 0.43  0.38  1.13  1.28 

30 0.45  0.41  0.64  1.59 

35 0.43  0.46  0.35  2.02 

40 0.31  0.55  0.16  2.59 

Under  the  present  plan  the  rates  decrease  after  a  certain  point  with 
the  increase  in  age  at  entrance.  This  is  due  to  the  fact  that  invalidity 
retirement  is  not  allowed  until  after  20  years'  service,  and  the  older  entrants 
are  generally  disabled  before  they  become  eligible  for  pension.  Although 
the  proposed  plan  allows  retirement  for  disability  at  any  time,  the  result- 
ing increase  in  cost  is  somewhat  compensated  for  by  a  reduction  in  the 
amount  of  the  pension  allowance. 

Withdrawal  Benefits 

No  comparison  can  be  drawn  between  the  present  and  proposed  plans 
with  regard  to  the  return  of  contributions  to  employees  leaving  the  service 
by  death,  resignation  or  dismissal,  because  under  the  existing  plan  no 
return  is  made.  The  following  rates,  therefore,  apply  only  to  benefits  of 
this  nature  allowed  under  the  proposed  plan.  Since  a  return  of  contribu- 
tions is  made  to  employees  only,  the  proportion  of  the  total  cost  to  be 
contributed  by  employees  had  to  be  considered  in  this  case  before  the  total 
rate  could  be  computed.  The  rates  below  show  the  amount  of  contribution 
required  to  provide  for  the  return  in  full  of  employees'  contributions  on 
separation  from  service: 


Age  at  Entrance 

Men 
Teachers 

Women 
Teachers 

20... 

0.70 

1  04 

25... 

0.61 

0  92 

30... 

0  53 

0  81 

35... 

0.48 

0.74 

40... 

0.45 

0  73 

*  The  preliminary  plan  provided  for  disability  retirement  after  any  period  of  service.  Sub- 
sequently the  minimum  lo-year  service  limitation  was  added  as  a  proper  safeguard  to  the  fund. 
To  avoid  delay  in  the  publication  of  this  report,  no  change  in  the  original  cost  calculations  has  been 
made.  The  necessary  slight  adjustments  in  rates  will  be  made  when  the  cost  of  the  final  plan  is 
calculated  in  all  its  details. 

63 


All  Benefits  Combined 

To  facilitate  the  comparison  of  all  benefits  allowable  under  the  present 
pension  plan  with  those  provided  under  the  proposed  plan,  two  sets  of 
rates  are  given  for  the  new  plan.  One  set  includes  only  the  superannua- 
tion and  disability  benefits  which  correspond  to  the  two  similar  provisions 
in  the  present  plan,  while  the  second  set  of  rates  covers  these  two  benefits 
and  the  return  of  contributions.  A  comparison  of  the  first  set  of  rates 
with  those  showing  the  cost  of  the  present  pension  plan  gives  some  idea 
of  the  effect  of  the  proposed  modification  in  the  benefits  of  the  present 
system.  A  comparison  of  the  second  set  of  rates  with  those  showing  the 
cost  of  the  present  pension  plan  gives  the  relative  cost  of  the  two  plans 
in  their  entirety. 


Men  Teachers 

Women  Teachers 

Age  at  Entrance 

Present 
Plan 

Proposed  Plan 

Present 
Plan 

Proposed  Plan 

Without    1     With 

Without    1     With 

Rettim  of  Contribs. 

Retvu-n  of  Contribs. 

20 

3.45 
3.93 
4.41 
4.63 
4.20 

4.35 
4.51 
4.82 
5.26 
5.81 

5.05 
5.12 
5.35 
5.74 
6.26 

6.49 
7.25 

7.18 
6.51 
5.32 

4.48 
5.18 
6.02 
7.03 
8.33 

5.52 

25 

6.11 

30 

6.81 

35 

7.77 

40 

9.07 

64 


CHAPTER  VII 

SUMMARY  OF  RECOMMENDATIONS  FOR  FINANCING  FUND 

REQUIREMENTS 


Plan  Proposes  Definite  Settlement  of  "Deficiency"  Problem 

To  facilitate  a  clear  understanding  of  the  financial  condition  of  the 
fund  on  June  30,  1914,  under  the  assumed  operation  of  the  new  provisions 
recommended  for  its  reorganization,  the  following  summary  of  the  detailed 
valuation  balance  sheet  on  page  174  is  presented: 

LlABH-ITIES 

Value  of  1,521  pensions  already  granted $11,581,210 

Value  of  prospective  pensions  to  teachers  now  in  service 48,227,475 

Value  of  refunds  of  contributions 4,105,235 

Total $63,913,920 

Assets 

Funds  in  hand $882,715 

Value  of  salary  contributions  of  present  force  in  accordance  with  suggested 

graduated  scale 22,108,950 

Value  of  annual  "normal"  budgetary  appropriations  by  city  of  between 
2M%  and  3%  of  salaries  of  present  teachers  on  account  of  pensions 
accruing  for  future  services 13,022,825 

Value  of  unSorm  "deficiency"  appropriations  by  city  of  $1,233,220  annually 
during  the  next  60  years  for  the  discharge  of  the  deficiency  arising  from 
insufficient  contributions  in  the  past 27,899,430 

Total $63,913,920 


The  above  statement  shows  the  discounted  value,  at  4  per  cent,  com- 
pound interest,  of  the  future  pension  payments  and  the  amounts  which 
will  be  paid  into  the  fund  if  the  reorganization  plan  is  adopted.  It  is 
comparable  with  the  statement  of  the  fund's  position  under  present  pro- 
visions, presented  on  page  30,  reflecting  likewise  the  financial  situation 
as  it  was  on  June  30,  19 14,  with  respect  to  pensioners  and  active  teachers 
then  on  the  rolls,  and  excluding  future  payments  and  contributions  on 
behalf  of  new  entrants. 

The  future  pension  payments  which  would  be  made  under  the  pro- 
posed plan  have,  if  discounted  at  4  per  cent,  compound  interest,  a  present 
capital  value  of  $63,913,920,  or  $5,895,840  less  than  under  the  plan  now 
in  operation.  It  must  be  remembered,  however,  that  if  the  proposed  plan 
is  adopted  the  city  and  the  teacher  will  have  come  to  a  definite  understand- 
ing as  to  how  the  future  cost  is  to  be  met.  This  will  guarantee  the  future 
payment  of  pensions  to  prospective  pensioners,  an  assurance  which  under 
the  present  scheme  is  lacking. 

65 


The  recommended  distribution  of  the  cost  of  future  payments  con- 
templates that  the  city  and  the  teacher  face  squarely  the  situation  and  by 
a  definite  decision  lay  the  foundation  for  a  perpetually  solvent  retirement 
plan.  I'he  recommended  future  city  contributions  have  a  discounted  value 
of  $40,922^55,  or  $18,813,305  in  excess  of  the  value  of  future  contribu- 
tions of  the  teachers.  This  excess  burden  on  the  part  of  the  city  as  com- 
pared to  that  of  employees  is  due  to  (i)  the  recommended  assumption  by 
the  city  of  the  fund's  obligations  in  their  entirety  on  account  of  payments 
to  present  pensioners,  the  value  of  which  is  $11,581,210,  and  (2)  to  the 
limitation  of  the  contributions  of  present  active  teachers  to  8  per  cent,  of 
their  salaries,  which  accounts  for  the  remaining  $7,232,095  of  the  city's 
excess  burden. 

The  above  financial  arrangements  provide  for  the  future  solvency  of 
the  fund  only  with  regard  to  present  pensioners  and  the  active  force.  The 
fund's  solvency  with  regard  to  new  entrants  necessitates  adequate  contri- 
butions to  the  fund  on  their  behalf.  This,  is  provided  for  by  the  rates  of 
contributions  calculated  for  new  entrants  in  a  preceding  chapter  of  this 
report  and  the  recommendation  that  the  city  pay  annually  an  amount  equal 
to  the  total  of  their  contributions. 

Contributions  of  Teachers  and  City 

The  fund's  income  as  suggested  in  the  reorganization  plan  will  be 
derived,  in  addition  to  the  4  per  cent,  compound  interest  accumulations, 
as  follows: 

Contributions  of  Teachers 

Teachers  now  in  service  will  contribute,  according  to  present  age  and 
length  of  service,  from  2.63  per  cent,  to  8  per  cent.,  their  total 
annual  contributions  averaging  about  5^  per  cent,  of  their  salaries. 

New  entrants  will  contribute,  according  to  age  at  entrance,  between 
2.52  per  cent,  and  4.53  per  cent.,  their  total  annual  contributions 
averaging  about  3  per  cent,  of  their  salaries. 

The  total  contributions  of  teachers  during  the  first  year  will  amount 
to  about  $1,529,700,  which  is  approximately  5^  per  cent,  of  the  total 
payroll.  With  the  replacement  of  teachers  now  in  service  by  new 
entrants  during  the  next  47  years,  the  annual  contributions  of 
the  entire  teaching  force  will  gradually  decrease  to  about  3  per 
cent,  of  the  total  payroll  and  become  stationary  thereafter. 

Contributions  of  City 

The  normal  contribution  of  the  city  will  be  about  3  per  cent,  of  the 
entire  payroll  annually,  and  will  amount  during  the  first  year  to 
$866,710.  These  contributions  will  be  made  by  the  city  on  account 
of  pensions  which  will  accrue  to  present  teachers  and  new  entrants 
in  recognition  of  future  services,  and  are  the  current,  or  "nor- 

66 


mal,"  pension  charge  of  the  city  which  would  have  been  required 
in  any  event  under  the  plan  suggested  had  no  deficiency  existed. 

The  deficiency  contribution  of  the  city  will  consist  of  $1,233,220  pay- 
able annually  for  the  next  60  years.  These  payments  have  a  dis- 
counted value,  at  4  per  cent,  compound  interest,  of  $27,899,430. 

The  total  contributions  of  the  city  during  the  first  year  will  amount 
to  about  $2,099,930,  which  is  about  y^  per  cent,  of  the  payroll. 
At  the  end  of  the  60-year  period,  when  all  present  pensioners  and 
practically  all  teachers  of  the  present  force,  subsequently  retired, 
will  have  passed  away,  the  deficiency  will  be  wiped  out  and  the 
city  will  be  required  to  make  only  the  normal  contribution. 

Perpetual  Solvency  Guaranteed  by  Provision  for  Future  Adjustments 

The  sufficiency  of  the  recommended  contributions  of  teachers  and  the 
city  depends  on  the  accuracy  of  a  forecast  of  the  fund's  future  operation 
extending  over  a  considerable  number  of  years.  The  actual  past  experi- 
ence of  the  active  service  and  pensioners  during  a  period  of  6  years  has 
supplied  a  basis  for  calculations  which  is  reliable,  due  to  the  large  number 
of  persons  considered,  and  is  the  best  which  is  available  under  the  circum- 
stances. Notwithstanding  this,  the  actual  future  rates  of  mortality,  retire- 
ment, withdrawal,  etc.,  may  be  expected  to  differ  from  those  assumed. 
It  is  necessary,  therefore,  to  observe  closely  the  fund's  future  operation. 
This  is  provided  for  by  the  recommendation  that  the  fund's  liabilities  and 
assets  be  periodically  appraised.  If  at  the  next  valuation  there  will  be 
found  a  surplus  or  deficiency  due  to  variations  in  rates,  including  the 
assumed  rate  of  interest,  controlling  the  financial  condition  of  the  fund, 
the  account  will  be  balanced  by  a  modification  of  the  contributions  of  the 
teachers  and  the  city.  Such  modification  will  remain  in  force  until  the 
next  valuation  is  made  and  the  sufficiency  of  the  contributions  is  again 
tested.    In  this  manner,  the  perpetual  solvency  of  the  plan  will  be  insured. 


60  Year  "Deficiency"  Contribution  Provides  for  Perfection  in  Financial 
Basis  of  Plan 

One  of  the  most  difficult  obstacles  in  the  reorganization  of  the  fund 
on  a  sound  foundation  is  the  necessity  for  large  annual  contributions  on 
the  part  of  the  city,  which,  during  the  first  year,  will  be  about  $2,099,930. 
Of  this  amount  the  normal  contribution  of  3  per  cent,  of  the  payroll,  or 
$866,710,  during  the  first  year  may  be  considered  a  reasonable  current 
pension  charge,  especially  in  view  of  the  substantial  advantages  gained 
from  the  operation  of  a  sound  retirement  system  and  the  further  fact  that 
the  teaching  force  contributes  a  like  amount. 

On  the  other  hand,  the  provision  for  the  discharge  of  the  $27,899,430 
deficiency  of  the  fund  by  means  of  sixty  annual  instalments  of  $1,233,220 
each  may  be  found  to  impose  an  excessive  burden  on  the  taxpayer.     Its 

67 


adoption,  however,  is  urged  because  resolute  action  in  this  matter  cannot 
be  had  too  soon.  Delay  is  expensive,  because  the  deficiency  grows  at  4  per 
cent,  compound  interest  and,  if  continued  indefinitely,  will  prove  disastrous 
to  the  fund. 

It  must  be  remembered  also  that  under  the  recommended  plan  present 
teachers  will  be  taxed  on  account  of  arrears  in  contributions.  If  the  city 
expects  the  teachers  to  pay  a  part  of  the  deficiency  accumulated  in  the 
past,  it  should  be  willing  to  do  likewise. 

That  the  recommended  solution  of  the  deficiency  problem  has  the 
endorsement  of  English  actuaries  may  be  indicated  by  the  following  quo- 
tation from  the  testimony  *  of  the  counsel  of  the  city  of  Liverpool  at  a 
hearing  before  the  Select  Committee  of  the  House  of  Commons  on  the 
Liverpool  Corporation  Bill: 

"I  would  remind  you  that  there  was  a  discussion  in  regard  to  this 
very  matter  before  the  Society  of  Actuaries,  and  they  then  came  to 
the  conclusion  that  this  was  the  fair  way  of  dealing  with  it  as  between 
nothing,  which  is  what  the  Liverpool  Corporation  might  take  on  an 
ultimate  period  of  100  years,  which  would  more  than  cover  the  whole 
period — that  it  would  be  a  fair  thing  to  take  some  intermediate  period : 
and  after  discussion  among  other  people  who  are  agreed  as  to  the  pro- 
posal of  60  years,  Mr.  Carson  Roberts,  one  of  the  auditors  of  the 
Local  Government  Board,  who  is  very  much  interested  in  this  matter, 
said  this.  There  was  a  discussion  on  a  paper  read  in  April,  1912, 
before  the  Institute  of  Actuaries,  and  Mr.  Carson  Roberts  said:  Tt 
was  urged  that  the  initial  deficiency  should  be  discharged  by  a  sinking- 
fund  of  limited  duration,  and  60  years  was  shown  to  be  the  most  rea- 
sonable period.  He  agreed  absolutely  that  these  arguments  were  finan- 
cially sound,  and  that  60  years  was  a  very  right  and  proper  selection. 
He  entirely  agreed  with  Mr.  Ackland  and  Mr.  Manly :  Let  them  by  all 
means  have  a  60-year  discharge  definitely  prescribed  in  the  next  Act 
if  they  could.  Then  they  would  have  reached  perfection  in  the  finan- 
cial basis  of  this  pension  legislation.'  " 


Method  Adopted  by  Liverpool  Contemplated  by  Other  Cities 

The  advantages  of  operating  pension  funds  on  a  strictly  "reserve" 
basis  are  being  realized  by  various  municipalities  of  Great  Britain.  Unsci- 
entific fund  methods,  after  an  extended  and  costly  experience,  are  being 
gradually  abandoned  under  the  growing  influence  of  British  actuaries. 

One  of  the  best  examples  of  placing  a  municipal  pension  fund  on  a 
basis  of  solvency  is  supplied  by  the  recent  reorganization  of  the  Liverpool 
pension  fund  for  city  employees,  including  school  teachers.     The  sound- 

*  See  "Minutes  of  evidence  taken  before  the  Select  Committee  of  the  House  of  Commons 
on  the  Liverpool  Corporation  Bill,"  Tuesday,   May  zy,   1913,   page  35. 

68 


ness  of  the  methods  adopted  for  dealing  with  the  "deficiency"  problem  is 
being  recognized  by  other  cities,  and  Manchester  and  Edinburgh  are  defi- 
nitely considering  its  adoption.  With  minor  exceptions,  it  is  also  the  basis 
of  the  recommendations  for  funding  accrued  liabilities  contained  in  this 
report. 

The  Liverpool  reorganization  scheme  of  1913,  after  32  years  of  this 
city's  unsatisfactory  experience  with  its  pension  funds,  provides  for  the 
"share-and-share-alike"  method  of  carrying  the  cost  of  pensions.  The  city 
pays,  by  means  of  "normal"  annual  contributions  of  5  per  cent,  of  the  pay- 
roll its  half  of  the  current  pension  charge  for  services  of  employees  after 
the  date  of  reorganization.  The  employees,  in  addition  to  their  current 
contributions  of  4  per  cent,  of  salary  and  upward,  are  paying  arrears  in 
contributions  for  services  prior  to  the  date  of  reorganization.  The  defi- 
ciency of  $3,575,000,  due  to  insufficient  income  in  the  past  not  covered  by 
the  employees'  back  contributions,  is  discharged  by  the  city  separately  by 
means  of  60  equal  annual  "deficiency"  appropriations  of  $143,000. 


Example  of  Compromise  on  "Semi-reserve"  Plan 

;  While  the  proposed  method  for  the  discharge  of  the  teachers'  retire- 

ment fund's  deficiency  of  $27,899,430,  by  means  of  60  equal  annual  defi- 
ciency contributions  of  $1,233,220,  appears  to  be  the  most  logical  and  in 
the  long  run  the  most  practical  method  of  placing  the  fund  in  a  state  of 
solvency,  the  city  may  find  itself  unable  at  the  present  time  to  make  the 
necessary  appropriations. 

If  this  should  be  the  case,  a  compromise  on  a  "semi-reserve"  plan  may 
be  considered  as  the  next  best  alternative.  Under  such  a  plan,  the  teachers' 
contributions  would  be  safeguarded  by  their  accumulation,  at  interest,  on 
the  "reserve"  basis.  They  would  form  a  separate  fund,  out  of  which  pay- 
ments would  be  made  to  satisfy  only  that  part  of  the  claims  of  its  con- 
tributors which  accrue  because  of  the  amounts  actually  paid  by  them  into 
the  fund.  The  balance  of  maturing  obligations,  such  as  payments  in  full 
to  present  pensioners  and  that  part  of  the  pensions  to  present  teachers  and 
future  entrants  which  is  not  paid  for  by  their  own  contributions,  would  be 
paid  currently  by  the  city  on  the  "cash  disbursement"  basis. 

Under  this  compromise  plan,  the  teachers'  contributions  would  be  the 
same  as  under  the  plan  recommended,  their  total  first  year's  payments 
amounting  to  about  $1,529,700,  or  5^  per  cent,  of  the  total  payroll.  Only 
an  insignificant  part  of  these  contributions  may  be  disbursed  in  the  near 
future.  On  the  other  hand,  the  city  would  not  be  required  to  make  annual 
"normal"  and  "deficiency"  appropriations.  Instead  of  these  initial  appro- 
priations of  a  total  of  $2,099,930,  the  city  would  be  called  upon  to  meet 
the  balance  of  the  fund's  maturing  obligations,  amounting  to  about  $1,100,000 
during  the  first  year,  and  rapidly  increasing  in  amount  for  a  great  number 
of  years. 

6d 


The  part  of  the  compromise  plan  financed  by  the  city  on  the  "cash 
disbursement"  basis  would  be  open  to  many  objections,  discussed  in  detail 
on  pages  27  and  28  of  this  report.  If  its  adoption  is  necessitated  by  present 
financial  limitations,  it  should  be  restricted  to  a  temporary  period  of  about 
3  to  5  years.  On  the  basis  of  a  new  valuation  of  the  fund  at  the  end  of 
this  period,  its  reorganization  on  the  purely  "reserve"  principle  should 
again  be  considered. 

Examples  of  the  compromise  "semi-reserve'^  method  of  financing  fund 
requirements  are  supplied  by  two  pension  funds  of  the  New  Zealand  gov- 
ernment service.  There  the  employees  contribute  from  5  per  cent,  to  10 
per  cent,  of  their  salaries  on  account  of  current  services.  The  government 
contributes  to  each  of  the  funds  on  the  "cash  disbursement"  basis  "the 
annual  sums  required  by  the  fund  to  provide  retiring  and  other  allowances 
falling  due  within  the  ensuing  three  years  without  affecting  or  having 
recourse  to  the  actuarial  reserve  appertaining  to  the  contributors'  contri- 
butions." These  government  contributions,  determined  upon  at  each  tri- 
ennial valuation  of  the  funds,  as  provided  by  law,  have  been  rapidly 
increasing,  as  may  be  seen  from  the  statement  presented  below.  Notwith- 
standing the  somewhat  optimistic  opinion  of  the  government  actuary  that :  * 
"so  long  as  the  fund  (Public  Service  Superannuation  Fund)  is  conducted 
on  the  present  lines,  it  will  be  a  credit  to  the  Dominion,  an  institution  able 
to  stand  any  investigation,  and  to  which  its  members  should  be  proud  to 
belong,"  it  may  be  pertinent  to  ask  the  question,  "How  long  will  the  New 
Zealand  government  be  willing  to  foot  an  ever-increasing  pension  charge?" 


AMOUNTS  OF  ANNUAL  CONTRIBUTIONS  BY  THE  NEW  ZEALAND  GOVERNMENT 
DURING  THE  YEARS  INDICATED,  FOR  MEETING  ON  THE  "CASH  DISBURSE- 
MENT" PLAN  MATURING  PENSION  OBLIGATIONS  NOT  COVERED  OUT  OF 
THE   employees'    "RESERVE   FUND" 


Year 


1908. 
1909. 
1910. 
1911. 
1912. 
1913. 
1914. 
1915. 
1916. 


"Public  Service" 

"Teachers'" 

Superannuation 

Superannuation 

Fund 

Fund 

£23,000 

£7,000 

23,000 

7,000 

23,000 

7,000 

48,000 

17,000 

48,000 

17,000 

48,000 

17,000 

66,000 

33,000 

66,000 

33,000 

66,000 

33,000 

*  Report   of   Morris   Fox,   Actuary   of  the   Government   Insurance   Department,   on   the   Public 
Service  Superannuation  Fund,  Wellington,  23d   September,   191 1,  page  5. 


70 


PART  II 

DESCRIPTIVE  REPORT 

HISTORY  AND  ADMINISTRATION 


CHAPTER  VIII 

THE  EXISTING  FUND  AND  THE  MACHINERY  FOR  ITS 
ADMINISTRATION 

The  provisions  of  the  law  under  which  the  New  York  Teachers'  Re- 
tirement Fund  is  operated  at  the  present  time  are  set  forth  in  sections  1092, 
1092-a  and  1092-b  of  the  Greater  New  York  Charter. 


Benefits  Paid  by  Fund 

To  the  teaching  and  supervising  staff  of  the  Department  of  Education : 

On  account  of  30  years'  teaching  service  (15  of  which  must  be  in 
the  schools  of  the  city  of  New  York)  : 

Half  of  final  salary,  minimum  $600,  maximum  $1,500  for 
teachers  and  principals,  $2,000  for  supervising  officials;  in 
force  since  May  31,  1905  (laws  of  1905,  ch.  661). 

*  Compulsory  superannuation  retirement  at  age  65,  after  30  years' 
teaching  service  (no  minimum  requirement  of  service  in  the 
schools  of  the  city  of  New  York)  : 

Half  of  final  salary,  minimum  $600,  maximum  $1,500  for 
teachers  and  principals,  $2,000  for  supervising  officials;  in 
the  discretion  *  of  the  Board  of  Education ;  in  force  since 
May  31,  1905  (laws  of  1905,  ch.  661). 

On  account  of  disability  after  20  years'  teaching  service  (15  of 
which  must  be  in  the  schools  of  the  city  of  New  York)  : 

One-sixtieth  of  final  salary  for  each  year  of  service  (not 
exceeding  one-half  final  salary  nor  $1,500  for  teachers  and 
principals,  and  $2,000  for  supervising  officials)  ;  in  force 
since  May  31,  1905  (laws  of  1905,  ch.  661). 

To  the  teaching  and  supervising  force  of  Hunter  College: 

On  account  of  30  years'  teaching  service  (no  requirement  of  mini- 
mum service  in  the  city  of  New  York)  : 

Not  less  than  one-half  of  final  salary,  and  if  a  president  or 
professor  this  sum  to  be  increased  to  make  an  even  multiple 
of  $1,000;  in  force  since  April  i8th,  1907  (laws  of  1907, 
ch.  167). 

On  account  of  disability  after  20  years'  teaching  experience  ( 10  of 
which  must  be  in  the  city  of  New  York)  : 

One-sixtieth  of  final  salary  for  each  year  of  service ;  in  force 
since  April  18,  1907  (laws  of  1907,  ch.  167). 

*  Section  39,  paragraph   19-a,  of  the  Board  of  Education  by-laws,  as  amended   December  zt, 
191 1,  compels  the  retirement  at  age  70  of  all  legally  eligible. 

73 


Reinstatement  of  Teachers 

Teachers  retired  may  be  reinstated  upon  their  application,  subject  to 
the  approval  of  the  Board  of  Education.  Upon  reappointment,  annuity 
ceases. 

Income  of  the  Fund 

The  income  of  the  fund  is  derived  from  the  following  sources: 

Employees: 

One  per  cent,  of  salary,  not  exceeding  $30  annually  for  teachers  and 
principals,  and  $40  for  supervising  officials ;  contributions  refunded 
in  case  of  dismissal;  Hunter  College  staff  contributes  i  per  cent, 
without  maximum  limitation;  in  force  since  May  31,  1905  (laws 
of  1905,  ch.  661). 

City  indirect: 

1.  Salary  deductions  and  forfeitures;  in  force  since  April  22,   1901 

(laws  of  1901,  ch.  466),  and  in  the  case  of  teachers  of  the  old 
city  of  New  York  since  1894  (laws  of  1894,  ch.  296). 

2.  Five  per  cent,  of  city's  excise  moneys ;  in  force  since  March  21,  1898 

(laws  of  1898,  ch.  91). 

Others: 

Donations,  bequests,  etc.;  in  force  since  establishment  of  funds  in 
1894  and  1895  (laws  of  1894,  ch.  296,  and  laws  of  1895,  ch.  656, 
respectively). 

Administration  of  the  Fund 

The  Board  of  Education  is  the  trustee  of  the  Teachers'  Retirement 
Fund.    It  is  required  to: 

1.  Care  for  and  manage  the   fund,  and  establish  rules  and  regula- 

tions for  its  administration 

2.  Grant  annuities,   at  its   discretion,   to  those   eligible   for  pension, 

within  the  income  of  the  fund  and  the  limits  defined  by  the  law 

3.  Make  monthly  payments,  though  the  conptroller,  of  the  annuities 

granted 

The  comptroller  of  the  city  of  New  York  is  required  to  act  as  treasurer 
of  the  fund,  and  in  such  capacity  to  : 

1.  Hold  and  invest  all  moneys  belonging  to  the  fund 

2.  Pay  out  moneys  at  the  direction  of  the  Board  of  Education,  in- 

cluding the  income  but  not  the  principal  of  the  $800,000  perma- 
nent fund 

3.  Report  annually  to  the  Board  of  Education  the  condition  of  the 

fund,  giving  itemized  statements  of  receipts  and  disbursements 
on  account  thereof 

74 


Organization  Provided  for  Administration 

A  Board  of  Retirement  is  provided,  consisting  of  the  president  of 
the  Board  of  Education,  the  chairman  of  the  Committee  on  Elementary- 
Schools,  the  chairman  of  the  Committee  on  High  Schools  of  said  board,  the 
city  superintendent  of  schools  and  three  members  of  the  teaching  force. 
The  secretary  of  this  board,  who  serves  without  salary,  attends  to  the 
details  connected  with  the: 

1.  Examination  and  verification  of  applications  for  retirement 

2.  Keeping  of  retirement  records 

3.  Preparation  and  distribution  of  annual  reports  and  statements 

The  city  superintendent  of  schools  keeps  a  service  record  of  teachers, 
which  is  used  to  verify  the  claims  of  applicants  for  retirement. 

The  secretary  of  the  Board  of  Education  keeps  the  original  roster  of 
pensioners  from  which  the  monthly  pension  payrolls  are  prepared,  and 
advises  those  concerned,  the  secretary  of  the  Board  of  Retirement  and 
the  comptroller,  of  changes  therein. 

The  bureau  of  audits  and  accounts  of  the  Department  of  Education 
is  responsible  for  the  certification  of  absence  deductions  and  absence  refund 
payrolls. 

The  division  of  refunds  of  the  Department  of  Finance  keeps  the 
accounts  of  the  fund. 


Procedure  in  Granting  Service  Pensions 

A  teacher  desiring  to  retire  from  active  service,  after  30  years  or 
more,  files  an  application  for  a  pension  with  the  Board  of  Retirement  on 
a  printed  form,  giving  a  sworn  statement  of  reasons  for  proposed  retire- 
ment, date  of  birth,  and  length  and  place  of  service  separately  for  New 
York  City  schools  and  those  outside  the  city. 

Upon  receipt  of  the  application  by  the  Board  of  Retirement  it  is 
turned  over  to  a  clerk,  who  records  it  in  a  book  kept  for  that  purpose.  A 
signed  transcript  of  the  official  record  in  the  office  of  the  city  superin- 
tendent of  schools,  showing  the  discipline,  efficiency  and  punctuality  of  the 
teacher  for  the  preceding  five  years,  and  the  total  length  of  service  and 
teaching  experience,  is  then  added  to  the  application.  Recommendations 
from  the  district  superintendent  and  the  principal  in  control  of  the  appli- 
cant are  also  obtained.  The  entire  information  is  then  checked  by  the 
secretary  of  the  Board  of  Retirement. 

One  week  before  the  meeting  of  the  Board  of  Retirement,  which  is 
usually  held  once  a  month,  a  list  of  the  applications  to  be  considered  by 
the  board  is  sent  by  the  clerk  of  the  board  to  each  member,  giving  them 
an  opportunity  to  investigate  the  merits  of  the  applicants. 

The  applicant,  or  in  case  of  the  applicant's  inability  a  relative  or  friend, 
appears  before  the  board  for  personal  interrogation  and  testimony,  which 

75 


is  reported  by  the  clerk  and  attached  (in  typewritten  form)  to  the  appH- 
cation  papers.  After  favorable  action,  the  applicant  is  required  to  sign  a 
card  (blue  for  men,  white  for  women,  pensioners),  giving  his  or  her 
address  and  the  name  and  address  of  the  nearest  friend.  The  reverse  side 
of  the  card  contains  the  name,  address,  date  of  birth,  date  of  appointment, 
date  of  retirement,  retirement  number  and  Board  of  Retirement  number, 
school,  borough  and  position  in  last  employment,  experience  in  New  York 
City,  other  experience,  total  experience,  salary  at  retirement,  annuity  and 
monthly  payment  thereon,  and  reason  for  retirement.  Space  is  also  pro- 
vided for  entry  of  date  and  cause  of  death.  This  record  is  kept  in  the 
office  of  the  secretary  of  the  Board  of  Education. 

A  duplicate  set  of  cards  and  a  bound  volume  containing  the  same 
information  are  kept  by  the  secretary  of  the  Board  of  Retirement,  who  is 
advised  by  the  secretary  of  the  Board  of  Education  of  changes  occurring 
through  death,  additional  retirements,  or  marriage. 

Advice  of  action  taken  at  the  meeting  of  the  Board  of  Retirement  is 
transmitted  to  the  Board  of  Education.  A  two-thirds  vote  of  all  the  mem- 
bers of  this  board  is  required  to  grant  the  application.  The  recommenda- 
tion of  the  Board  of  Retirement  is  invariably  taken.  Notice  of  favorable 
action  is  transmitted  by  the  secretary  of  the  Board  of  Education  to  the 
city  superintendent  of  schools  and  to  the  applicant.  The  application  and 
supporting  papers  are  placed  in  a  linen  envelope  endorsed  with  the  name, 
retirement  number.  Board  of  Education  number  and  date  of  retirement, 
and  are  filed  in  the  office  of  the  secretary  of  the  Board  of  Education.  On 
the  roster  of  the  secretary  of  the  Board  of  Education  are  entered  the  re- 
tirement number  and  name  of  the  pensioner,  last  position,  date  of  retire- 
ment, date  of  action  by  the  board,  amount  of  annuity,  and  remarks. 

Twice  a  year  applications  favorably  acted  upon  are  transmitted  ta  the 
auditor  of  the  Board  of  Education,  who  certifies  as  to  the  salary  received 
by  applicants  at  date  of  retirement,  upon  which  basis  the  retirement  allow- 
ance is  fixed.  Upon  receipt  of  this  information,  the  secretary  of  the  Board 
of  Education  transmits  to  the  comptroller  the  name,  address  and  date  when 
retirement  becomes  effective — either  February  ist  or  September  ist,  pend- 
ing which  the  applicant  may  continue  in  the  service  at  full  pay. 

When  the  secretary  of  the  Board  of  Education  receives  notice  of  the 
death  or  marriage  of  the  pensioner,  in  the  former  case  either  directly  from 
a  friend  of  the  pensioner  or  through  notice  from  the  paymaster  that  checks 
remain  unclaimed,  entry  is  made  on  his  records,  and  notification  given  to 
the  Finance  Department,  the  auditor  of  the  Board  of  Education  and  the 
secretary  of  the  Board  of  Retirement. 

Procedure  in  Granting  Compulsory  Superannuation  Pensions 

On  or  before  the  first  Monday  in  May  and  December,  the  city  super- 
intendent is  required  to  report  to  the  Board  of  Education  the  names  of  all 
members  of  the  teaching  and  supervising  staff  who  will  have  reached  the 

Y6 


age  of  70  and  be  eligible  for  pension  by  the  next  first  of  September  or 
February.  Under  the  by-law  previously  referred  to,  the  board  may  at  its 
discretion  retire  these  members  of  the  staff  from  active  service,  without  a 
two-thirds  vote  of  all  its  members,  as  is  required  in  the  case  of  service  and 
disability  pensioners. 

Procedure  in  Granting  Disability  Pensions 

The  procedure  used  in  obtaining  service  pensions  is  followed  by  appli- 
cants for  retirement  for  disability.  In  addition,  a  physician,  usually  the 
applicant's  personal  physician,  certifies,  without  oath,  as  to  the  cause  of 
disability.  If  any  member  of  the  Board  of  Retirement  has  reason  to  ques- 
tion the  certificate  of  the  private  physician,  because  of  information  received 
from  the  district  superintendent  or  the  principal  to  whom  the  teacher  is 
responsible,  or  from  other  sources,  the  board  may  require  a  sworn  state- 
ment, or  an  examination  of  the  applicant  by  a  physician  of  the  department, 
or  both ;  but  such  action  has  rarely  been  taken.  The  board  states  that  action 
has,  however,  been  taken  when  thought  necessary. 

Pensions  to  Hunter  *  CoUeg-e  Staff 

The  law  does  not  require  the  Boardi  of  Retirement  to  pass  upon-  pen- 
sions to  members  of  the  staff  of  Hunter  College.  Service  pensions  may 
be  granted  by  the  Board  of  Education  at  its  discretion  and  upon  its  own 
recommendation  as  the  Board  of  Trustees  of  Hunter  College.  Pensions 
for  disability  require  the  approval  of  the  Hunter  College  trustees,  and,  in 
addition,  a  two-thirds  vote  of  all  the  members  of  the  Board  of  Education. 
Records  of  these  retirements  are  kept  on  the  same  books  and  in  the  same 
manner  as  those  of  the  public  school  teachers,  at  the  offices  of  both  the 
secretary  of  the  Board  of  Education  and  the  secretary  of  the  Board  of 
Retirement. 

Procedure  in  Payment  of  Pensions 

Pensions  are  paid  monthly.  Annually  the  payrolls  for  use  during  the 
next  year  are  printed  by  the  secretary  of  the  Board  of  Education.  These 
payrolls  are  arranged  by  boroughs  and  are  based  upon  the  records  in  his 
office.  Additions  are  written  in  during  the  year  as  they  occur.  A  tran- 
script of  the  payrolls  is  copied  into  a  register  in  the  secretary's  office. 

These  payrolls  are  transmitted  monthly  to  the  Department  of  Finance 
and  referred  to  the  division  of  refunds,  where  they  are  checked  and  the 
amounts  entered  on  the  books  of  the  Retirement  Fund  as  a  charge  against 
the  fund. 

The  payrolls  are  then  sent  to  the  paymaster.  Pensioners  may  call  in 
person  at  the  office  of  the  paymaster  for  their  checks ;  but  as  a  rule,  arrange- 

*  Changed   from   "Normal"  to  "Hunter"  College,  April  4,    1914. 

77 


ment  is  made  to  have  the  receipts  mailed  to  them,  which  they  sign  and 
return  to  the  paymaster,  who  thereupon  forwards  the  check. 

Accounting 

The  auditor  of  the  Board  of  Education  transmits  to  the  secretary  a 
monthly,  certified  statement  of  salary  deductions  from  the  payrolls  of  the 
department.  If  later  there  are  absences  excused  with  pay,  he  prepares  a 
certified  absence  refund  payroll.  These  are  transmitted  by  the  secretary 
of  the  board  to  the  Department  of  Finance. 

The  accounts  kept  by  the  division  of  refunds  of  the  Department  of 
Finance,  are  simply  cash  book  entries  of  receipts  from  the  employees'  i  per 
cent,  contributions,  gross  absence  deductions,  excise  licenses,  interest,  dona- 
tions and  unclaimed  annuities,  and  disbursements  to  pensioners,  for  ad- 
ministrative expense,  and  for  refunds  of  absence  and  salary  deductions  and 
unclaimed  annuities,  posted  to  appropriate  ledger  accounts.  There  is  also 
maintained  a  record  of  the  investments  of  the  fund,  which  are  usually  in 
short-term  revenue  bonds  of  the  city,  yielding  upwards  of  4  per  cent,  interest 
per  annum.  The  fund's  share  of  excise  moneys  is  transferred  to  it  as  the 
comptroller  directs. 

Expense  of  Managing  Fund 

The  operation  expenses  chargeable  against  the  fund  are  limited  by 
law  not  to  exceed  $1,500,  which  sum  may  be  expended  at  the  discretion  of 
the  Board  of  Education  upon  the  recommendation  of  the  Board  of  Retire- 
ment. The  cost  of  printing  and  mailing  the  annual  report  and  $300  a  year 
for  clerical  assistance  to  the  secretary  of  the  Board  of  Retirement  have 
been  the  principal  items  of  annual  expense.  No  portion  of  the  salary  of 
any  employee  of  the  city,  except  as  above  mentioned,  may  be  charged  against 
the  fund. 


T8 


CHAPTER   IX 
THE  ACTIVE  SERVICE 

Employees  to  Whom  Pension  Provisions  Apply 

The  provisions  of  the  retirement  fund  apply  only  to  the  members  of 
the  teaching  and  supervising  staff  of  the  Board  of  Education.  The  classes 
of  employees  and  the  total  annual  salary  charges  as  of  May  31,  191 5,  are 
presented  in  detail  in  Table  i,  page  109.  The  teaching  staff  of  Hunter 
College  and  a  number  of  teachers  in  the  schools  under  the  jurisdiction  of 
the  Departments  of  Charities  and  Correction  are  also  covered  by  the  fund, 
as  shown  in  this  table. 

The  total  number  of  employees  contributing  to  the  fund  on  May  31, 
I9i5>  was  21,317,  of  which  2,713,  or  12.7  per  cent.,  were  men  and  18,604, 
or  87.3  per  cent.,  were  women,  and  the  total  annual  salary  charge  as  of 
that  date  was  $30,284,217.* 

This  number  does  not  include  substitute  teachers  who  make  no  con- 
tributions. The  non-teaching  staff  of  the  Department  of  Education,  which 
includes  the  administrative  officials,  the  clerical  force,  the  janitorial  service, 
the  construction  division,  etc.,  is  covered  by  the  provisions  of  the  "Grady 
Law"  (sections  165,  166  and  167  of  the  Greater  New  York  Charter), 
which  apply  to  all  municipal  employees  not  eligible  for  pensions  from  special 
departmental  funds.  The  number  of  employees  on  the  non-teaching  staff 
was  approximately  1,660  on  June  30,  1914. 

The  distribution  of  the  teaching  and  supervising  staff,  according  to 
age  and  length  of  service,  is  shown  in  Tables  2  and  3,  on  pages  no  and  in, 
for  men  and  women  respectively.  The  data  collected  in  the  census  of 
municipal  employees  on  June  30,  1914,  was  used  as  the  basis  for  compiling 
these  tables.    The  following  is  a  summary  of  age  distribution : 


Present  Age 

Men 

Women 

Total 

Number 

Per 

Cent. 

of 
Total 

Number 

Per 
Cent. 

of 
Total 

Number 

Per 
Cent. 

of 
Total 

17 
30 
40 
65 
70 

years  and  less  than  30  years 

"       "        "40      "     

"65      "    

"       "        "70      "    

"       "        "75      "    

707 
995 

878 
28 

3.4 

4.9 

4.3 

.1 

7,431 

5,800 

4,694 

51 

4 

36.1 

28.2 

22.8 

.2 

8,138 

6,795 

5,572 

79 

•    4 

39.5 

33.1 

27.1 

.3 

Totals 

2,608 

12.7 

17,980 

87.3 

20,588 

100.0 

*The  present  salary  rates,  in  effect  since  January  i,  1912,  as  well  as  those  obtaining  prior  to  the 
enactment  of  the  "equal  pay"  law,  are  presented  in  Table  4,  opposite  page   112. 

Y9 


The  following  summary  shows  the  distribution  by  years  of  service: 


Men 

Women 

Total 

Length  of  Service 

Number 

Per 

Cent. 

of 
Total 

Number 

Per 
Cent. 

of 
Total 

Number 

Per 
Cent. 

of 
Total 

Less  than  10  years 

10  years  and  less  than  20  years 

20       "        "       "        "30      "    

30  years  and  over 

1,357 

1,007 

194 

50 

6.6 

4.9 

1.0 

.2 

9,524 

5,460 

2,067 

929 

46.3 

26.5 

10.0 

4.5 

10,881 

6,467 

2,261 

979 

52.9 
31.4 
11.0 

4.7 

Totals 

2,608 

12.7 

17,980 

87.3 

20,588 

100.0 

Requirements  for  Entrance  Into  the  Service 

The  teaching  staff  is  recruited  through  examinations  held  by  the  Board 
of  Examiners  which  consists  of  the  city  superintendent  of  schools  and 
four  other  persons  appointed  by  the  Board  of  Education  upon  the  nomina- 
tion of  the  city  superintendent.  Eligible  lists  remain  in  force  for  three  years, 
except  those  for  principals,  which  remain  in  force  until  exhausted. 

The  age  limits  for  entrance  into  the  service,  in  force  since  1879,  vary 
according  to  the  license  issued,  but  the  usual  age  requirement  for  teachers 
is  from  18  to  40,  and  for  principals  from  25  to  50.  There  are  various 
exceptions  to  these  rules,  but  such  exceptions  apply  principally  to  promo- 
tions of  those  in  the  service. 

Before  appointment  a  physical  examination  is  made  of  all  applicants, 
by  either  a  man  or  woman  physician  of  the  Board  of  Education.  The 
few  rejections  that  are  made  are  mainly  for  defective  sight  or  hearing. 
Approximately  600  applicants  for  teachers'  licenses  were  examined  during 
the  year  1914,  and,  in  addition,  a  physical  examination  was  made  of  about 
900  applicants  for  the  training  school  for  teachers.  Physical  examination 
is  required  only  upon  entrance  into  service,  none  being  made  when  teachers 
are  promoted  to  higher  grades. 


Hours  of  Work  and  Vacation  Periods 

The  number  of  hours  which  a  teacher  devotes  to  her  duties  depends 
to  a  considerable  extent  upon  herself.  The  class-room  period  is  rarely  more 
than  five  hours  a  day,  but  frequently  the  teacher  spends  considerable  time 
after  school  hours  in  rating  papers  and  preparing  for  the  next  day's  class 
work. 

There  are  from  171  to  176  non-working  days  throughout  the  year, 
including  Saturdays  and  Sundays  and  the  vacation  periods.  This  leaves 
from  189  to  194  school  days.  Some  of  the  teachers  supplement  their 
salaries  by  teaching  in  evening  schools,  vacation  schools,  etc. 

80 


Leaves  of  absence  without  pay  are  granted  for  a  period  not  to  exceed 
one  year  for  the  purpose  of  study  or  restoration  of  health,  and  for  two 
years  for  child  bearing. 

Medical  Supervision  of  the  Teaching  Force 

The  Department  of  Education  has  no  staff  of  physicians  to  supervise 
the  health  of  the  teaching  force  or  to  investigate  causes  of  absence  on 
account  of  illness.  The  duties  of  the  two  physicians  employed  by  the 
department  are  restricted  to  the  physical  examination  of  applicants  for 
licenses.  Occasionally,  they  are  requested  to  verify  the  statements  of  pri- 
vate physicians  in  connection  with  applications  for  the  retirement  of  teach- 
ers because  of  disability.  No  statistics  are  available  at  present,*  therefore, 
showing  the  total  sick  rate  or  prevalent  diseases  among  teachers. 

Sick  Leave  Allowances 

Under  a  recent  rule,  very  much  stricter  than  the  rule  hitherto  in  force, 
teachers  absent  on  account  of  illness  are  allowed  full  pay,  at  the  discretion 
of  the  proper  departmental  officials,  for  varying  periods,  according  to 
length  of  service,  as  follows : 


Years  of  Service 

Maximvim  Number  of  Days 
Excused  with  Pay 

First  3  years 

4th  to  6th  year 

7th    "   10th    "    

20  days 
30     " 
40     " 

11th    "   15th   "    

50     " 

15th  year  and  thereafter 

60     " 

The  present  rules  governing  sick  leave  with  pay  were  established  on 
July  14,  191 5.  Deductions  of  1/25  of  a  month's  salary  are  made  auto- 
matically for  every  day's  absence  and  paid  into  the  retirement  fund.  In 
order  to  receive  full  pay  for  absences  on  account  of  illness,  the  teacher 
submits  an  application  with  a  physician's  certificate,  which  must  be  sworn 
to  if  required  by  the  Local  School  Board  or  by  the  Board  of  Superinten- 
dents. If  the  application  is  approved,  a  refund  of  the  amount  deducted  is 
made  out  of  the  retirement  fund. 

Prior  to  September,  1908,  the  maximum  annual  sick  leave  allowed  with 
full  pay  was  55  days.  The  regulations  in  force  from  September,  1908,  to 
July  14,  1915,  were  more  liberal.  Under  these  regulations,  1/30  of  a 
month's  salary  was  deducted  for  each  day's  unexcused  absence.     Full  pay 

*  A  thorough  study  of  this  subject  is  now  being  made  under  the  auspices  of  the  Bureau  of 
Reference  and  Research  of  the  Board  of  Education,  and  the  School  Problems  Committee  of  the 
Brookljm  Teachers'  Association. 


81 


was  granted  for  only  i^  days  of  the  first  4  days  excused,  but  additional 
leaves  of  absence  with  full  pay,  not  exceeding  91  days,  were  granted.  A 
teacher,  therefore,  could  absent  herself  from  duty  95  of  the  189  to  194  school 
days  and  receive  pay  for  all  but  2^  days.  It  was  possible  for  a  teacher  who 
was  absent  from  duty  the  entire  year  to  draw  about  71  per  cent,  of  her 
salary,  full  pay  for  92^  of  95  days'  excused  absence  and  171  to  176  non- 
school  days. 

It  has  been  shown,  conclusively,  in  a  report  submitted  by  Associate 
Superintendent  Shallow  to  the  city  superintendent  that  the  sick  rate  of 
teachers  depends  to  a  considerable  extent  on  the  comparative  liberality  of 
the  department  by-laws  relating  to  absences  excused  with  pay.*  In  this 
report  a  comparison  was  made  of  absences  of  teachers  during  the  year  1903 
under  stringent  absent  regulations  and  the  year  1912  under  the  most  liberal 
regulations  known  in  this  country.  It  was  shown  that  in  1903  about  2.8  per 
cent,  of  the  teachers  were  absent  during  the  year  and  in  1912  5  per  cent, 
were  absent.  It  is  obvious,  therefore,  that  present  statistics  of  illness 
among  the  active  force,  even  if  available  in  convenient  form,  cannot  be 
used  as  a  reliable  basis  for  conclusions  as  to  the  prevalence  of  disabling 
sickness  among  teachers. 

Discontinuance  from  Active  Service 

Table  5,  page  113,  compiled  from  the  data  collected  in  the  census  of 
municipal  employees  on  June  30,  1914,  shows  the  number  of  the  teaching 
force  discontinued  from  active  service  for  various  causes.  The  total  with- 
drawals for  the  six-year  period  ending  June  30,  1914,  were  as  follows: 


Cause  of  Withdrawal 

Number 

Per  Cent 
of  Total 

Dismissal 

13 

3,341 

418 

805 

4,577 

.3 

Resignation 

73.0 

Death 

9.1 

Retirement 

17.6 

Total  withdrawals 

100.0 

*  See  pages  371  to  389,  report  of  the  city  superintendent  of  schools  for  the  year  ending  July 
31,   1914- 


82 


CHAPTER   X 
ESTABLISHMENT  AND  DEVELOPMENT  OF  FUND 


New  York  Fund  Operated  Independently  from  1894  to  1901 

The  laws  of  1894  (chapter  296)  created  a  retirement  fund  for  the 
teachers  of  the  city  of  New  York,  providing  an  income  from  the  follow- 
ing sources: 

1.  Absence  deductions  from  the  salaries  of  teachers,  to  be  so  regu- 

lated as  to  provide  a  sufficient  income  for  the  payment  of  pensions 

2.  Donations,  legacies,  gifts,  etc. 

3.  Interest  on  the  fund 

Pensions  of  one-half  of  the  final  salary,  not  exceeding  $1,000,  could 
be  granted  by  a  two-thirds  vote  of  the  Board  of  Education  to  teachers 
mentally  or  physically  disabled  for  the  performance  of  duty,  upon  the 
recommendation  of  the  city  superintendent.  The  service  requirement  was : 
(i)  after  30  years  for  women  teachers,  and  (2)  after  35  years  for  men 
teachers. 

The  Board  of  Education  was  given  complete  charge  of  the  fund  and 
the  establishment  of  by-laws  for  its  management.  It  was  empowered  to 
reduce  pensions  to  a  uniform  rate.  The  comptroller  of  the  city  of  New 
York  was  made  treasurer  of  the  fund. 

Under  these  provisions  the  New  York  fund  was  operated  independ- 
ently of  the  Brookl)m  fund  until  the  close  of  190 1.  In  1894  the  income 
from  unrefunded  absence  deductions  amounted  to  $25,060.33.  During  the 
following  year,  35  teachers  were  placed  on  the  pension  roll  with  an  average 
service  of  39.09  years.  Their  average  age  at  appointment  was  19.71  years, 
many  having  entered  the  service  between  13  and  17  years.  The  retirements 
of  the  Manhattan  and  Bronx  teachers  during  the  seven  years  of  the  fund's 
independent  operation  were  as  follows: 


Year 

Men 

Women 

Total 

1895 

3 
6 

1 
6 
7 
2 
2 

27 

32 
44 
56 
18 
100 
25 
43 

318 

35 

1896 

50 

1897 

57 

1898 

24 

1899 

107 

1900 

27 

1901 

45 

Total 

345 

83 


Of  the  345  retired  teachers,  35  died  during  the  seven-year  period, 
leaving  on  December  31,  1901,  a  total  of  310  pensioners  on  the  pension  roll. 

The  Greater  New  York  consolidation  in  1897  did  not  affect  the  opera- 
tion of  the  fund.  Sections  1083  and  11 19  of  the  first  Greater  New  York 
charter  continued  the  separate  existence  of  the  New  York  and  Brooklyn 
funds,  adding,  however,  provisions  regulating  the  transfer  of  teachers  from 
one  fund  to  the  other.  To  section  1083  of  the  charter  (laws  of  1897,  chap- 
ter 378),  relating  to  the  New  York  fund,  was  added  the  following  pro- 
vision : 

"None  of  the  provisions  of  this  section  shall  apply,  however,  to 
any  teacher  in  any  school  in  the  Borough  of  Brooklyn  who  is  entitled 
to  any  benefit  under  the  fund  mentioned  in  section  11 19  (Brooklyn 
Teachers'  Fund)  of  this  act  until  after  his  removal  from  said  borough. 
When  a  teacher  is  transferred  to  the  Borough  of  Brooklyn,  a  sum 
equal  to  one  percentum  of  the  amount  paid  to  such  teacher  during 
said  teacher's  service  in  the  city  of  New  York,  as  constituted  prior  to 
the  passage  of  this  act,  since  the  date  on  which  the  Public  School 
Teachers'  Retirement  Fund  of  Brooklyn  was  created,  shall  be  paid 
into  the  said  Brooklyn  Retirement  Fund  and  inure  to  the  teacher's 
benefit  in  that  fund  under  the  rules  governing  the  same." 

In  1898  (laws  of  1898,  chapter  91)  a  new  source  of  income  was  applied 
to  the  fund.  Five  per  cent,  of  the  excise  moneys  belonging  to  the  city  of 
New  York  was  to  be  apportioned  by  the  Board  of  Education  among  the 
several  boroughs,  according  to  the  number  of  teachers  actually  employed 
and  the  amount  of  salaries  paid  to  them  in  each  of  the  boroughs. 

In  1901  (laws  of  1901,  chapter  186)  a  provision  was  added  providing 
for  a  minimum  pension  of  $600,  as  follows : 

"In  no  case  shall  such  annuity  for  any  teacher  already  retired  or 
hereafter  to  be  retired,  be  less  than  $600." 

This  automatically  raised  many  pensions  granted  prior  to  that  time  to  over 
50  per  cent,  of  the  salary  received  at  retirement.  The  additional  annual 
charge  on  account  of  this  provision  amounted  to  $13,035  in  1901. 

The  same  law  made  the  female  staflf  of  Hunter  College  eligible  to 
retirement  from  the  New  York  fund  under  more  favorable  conditions  than 
the  public  school  teachers.     It  gave  the  Board  of  Education  power 

"by  two-thirds  vote  of  all  its  members,  and  after  recommendation  to 
that  effect  shall  have  been  made  by  the  Board  of  Trustees  of  the 
Normal  College,  stating  that  the  teacher  is  mentally  or  physically 
incapacitated  for  the  performance  of  duty,  to  retire  the  female  super- 
intendent and  any  female  tutors  of  the  Normal  College  and  the  female 
superintendent  and  any  female  critic  teacher  of  the  Training  Depart- 
ment of  the  Normal  College  who  have  taught  in  said  Normal  College 
or  Training  Department  or  in  the  public  schools  during  a  period  ag- 
gregating thirty  years." 

84 


Retirement  on  application  without  proof  of  incapacity  and  regardless 
of  age  was  also  permitted  by  the  following  provision: 

"The  said  Board  of  Education,  upon  the  recommendation  of  the 
Trustees  of  the  Normal  College,  may  also,  in  its  discretion,  retire  any 
such  teacher  or  teachers  upon  her  or  their  own  application  after  the 
like  period  of  service," 

The  first  retirement  of  a  Hunter  College  teacher  under  these  pro- 
visions was  made  on  April  26,  1901,  when  a  pension  of  $455,  or  half  the 
teacher's  salary  of  $910,  was  granted.  The  provision  for  a  minimum  pen- 
sion of  $600  did  not  apply  to  the  Normal  College  retirements  at  that  time. 


Brookl3m  Fund  Operated  Independently  from  1895  to  1901 

As  early  as  1879  and  1881  the  Brooklyn  teachers  made  efforts  to 
establish  a  retirement  fund.  The  bills  introduced  in  the  legislature  of 
those  years  were,  however,  defeated.  The  campaign  for  pensions  continued 
and  succeeded  in  1895. 

The  laws  of  1895,  chapter  656,  established  the  Brooklyn  Teachers' 
Retirement  Fund,  which  was  to  derive  its  income  from  the  following 
sources : 

1.  One  per  cent,  of  future  salaries  of  existing  teachers  who  shall 
elect  to  come  under  the  act  and  one  per  cent,  of  the  salaries  of  all 
teachers  appointed  after  January  i,  1896 

2.  Donations,  legacies,  gifts,  etc. 

3.  Interest  on  the  fund 

Pensions  of  one-half  of  the  final  salary,  not  exceeding  $1,200,  were 
to  be  granted  at  the  discretion  of  the  Board  of  Education  of  the  city  of 
Brooklyn  to  women  teachers  not  less  than  55  years  old  and  to  men  teachers 
not  less  than  60  years  old,  after  a  teaching  experience  of  thirty  years,  of 
which  twenty  years  must  have  been  in  Brooklyn  schools.  No  retirement 
was  to  be  made  unless  the  teacher  had  paid  into  the  fund  20  per  cent,  of 
the  last  annual  salary  before  retirement. 

The  Board  of  Education  of  the  city  of  Brooklyn  was  given  complete 
charge  of  the  administration  and  custody  of  the  fund  and  empowered  to 
establish  rules  and  regulations  for  that  purpose.  It  was  also  given  the 
power  to  reduce  pensions  in  case  of  insufficiency  of  funds. 

The  pension  fund  operated  under  these  provisions  until  1901  without 
change. 

The  operation  of  the  fund  during  the  six-year  period  of  its  separate 
existence  is  shown  by  the  following  statement  of  receipts  and  disbursements, 
taken  from  the  1909  report  of  the  secretary  of  the  Board  of  Retirement: 

86 


Receipts 

Pensions 
Paid 

Year 

1  Per  Cent. 

Salary 

Contributions 

Back  Con- 
tributions 

of 
Pensioners 

Interest 

Total 

Balance 
Dec.  31st 

1896... 

}  $35,251.99 

21,483.17 
29,330.52 
35,763.09 
10,980. 38  (*) 

$6,032.00 

2,375.17 
1,149.34 
7,316.36 
8,761.70 
418.14 

$330.80 

728.20 

1,111.76 

1,317.83 

1,138.43 

43.34 

$41,614.79 

24,586.54 
31,591.62 
44,397.28 
20,880.51 
461.48 

$  1,927.06 
11,902.91 
19,315.49 
21,610.00 
41,329.63 
53,835.97 

1897. . . 
1898. . . 
1899. . . 
1900. . . 
1901... 
1902. . . 

$27,784.82 
33,055.87 
43,037.49 
46,105.14 
13,149.68 
13,611. 16(t) 

Total . . 

$132,809.15 

$26,052.71 

$4,670.36 

$163,532.22 

$149,921.06 

The  consolidation  of  Greater  New  York  in  1897  left  the  Brooklyn 
fund  undisturbed.  Section  11 19  of  the  charter  (laws  of  1897,  chapter  378), 
after  restating  the  provisions  of  the  Brooklyn  law,  provided  in  addition : 

"When  a  teacher  is  transferred  to  another  borough  having  a 
teachers'  retirement  fund,  his  or  her  contribution  may  be  paid  into 
the  said  fund  and  inure  to  the  teacher's  benefit  in  that  fund  under  the 
rules  governing  the  same." 

In  1898  (laws  of  1898,  chapter  91)  the  fund  became  entitled  to  a  share 
of  the  5  per  cent,  of  excise  moneys  of  the  city  of  New  York  in  proportion 
to  the  number  of  the  Brooklyn  teachers  and  their  salaries.  The  income 
from  this  source  remained  in  the  New  York  fund  and  was  credited  on  its 
books  to  the  Brooklyn  fund,  as  follows : 


1898 $97,045.27 

1899 94,676.37 

1900 95,437.30 

1901 75,213.31 

Total $362,372.25 

Funds  Consolidated  in  1901  with  Increased  Benefits 

The  laws  of  1901,  chapter  466,  provided  for  the  consolidation  of  the 
New  York  and  Brooklyn  funds.  The  benefits  of  both  funds  were  repealed 
and  retirement  provided  under  more  liberal  conditions.  Under  the  new 
law,  a  disability  pension  after  thirty  years  of  service  (twenty  in  New  York 

•The  law  discontinuing  contributions  of  teachers  became  effective  on  April  22,  1901. 
t  This  amount  was  turned  over  to  the  comptroller  of  the  city  of  New  York  on  January  22, 
1902,  upon  the  merging  of  the  Brooklyn  fund  with  the  New  York  City  fund. 


City)  was  allowed  at  one-half  of  the  salary  received  at  the  date  of  retire- 
ment, with  a  minimum  of  $600  and  a  maximum  limit  of  $1,000  for  teachers, 
$1,500  for  principals  and  $2,000  for  supervising  officials.  A  pension  of 
like  amount  was  permitted  at  65  years  of  age,  after  thirty  years'  service 
(twenty  in  New  York  City).  The  granting  of  a  disability  pension  required 
the  recommendation  of  the  city  superintendent  and  a  two-thirds  vote  of 
the  Board  of  Education.  There  was  no  such  requirement  for  the  "age  65" 
pension.  The  provisions  in  the  old  New  York  and  Brooklyn  laws  relating 
to  the  reduction  of  pensions  were  omitted. 

The  5  per  cent,  of  the  city's  excise  money  remained  as  one  of  the 
sources  of  income  of  the  fund.  The  income  from  unrefunded  absence 
deductions,  heretofore  accruing  only  to  the  old  New  York  fund,  was  ap- 
plied also  to  the  Brooklyn  teachers.  The  one  per  cent,  salary  contributions 
of  the  latter  which  the  law  had  required  in  the  past  were  discontinued. 

The  provisions  of  the  law  of  1901  (chapter  186),  passed  a  month 
before,  relating  to  the  female  staff  of  Hunter  College,  were  continued. 

In  1902  (laws  of  1902,  chapter  530)  the  scope  of  the  fund  was  ex- 
tended to  include  schools  and  classes  maintained  in  institutions  controlled 
by  the  Departments  of  Public  Charities  and  Correction.  The  city  superin- 
tendent of  schools  was  also  added  to  those  eligible  to  pension  benefits. 

In  1903  (laws  of  1903,  chapter  177)  the  limitation  on  Hunter  College 
benefits  to  women  was  removed.  A  requirement  was  added  that  ten  of 
the  thirty  years  of  service  of  the  Hunter  College  teachers  shall  be  in  the 
Hunter  College  or  training  department  of  the  city  of  New  York.  The 
law  changed  the  "one-half"  salary  provision  to  read  "not  less  than  one- 
half,"  and  further  provided  in  the  case  of  a  president  or  professor  "such 
an  additional  sum  per  annum  as  will  increase  such  one-half  of  the  salary 
previously  paid,  if  not  an  even  multiple  of  $1,000,  to  an  even  multiple  of 
$1,000."  It  also  provided  for  a  minimum  pension  of  $600  for  the  Hunter 
College  teachers. 

In  1905  (laws  of  1905,  chapter  107)  the  present  section  1092-a  of 
the  charter,  relating  to  the  exemption  of  pension  moneys  from  execution, 
was  inserted  in  the  law. 


Reorganization  of  Fund  from  1905  to  1914 

Substantial  changes  in  the  retirement  law  were  introduced  in  1905 
(laws  of  1905,  chapter  661)  and  became  effective  on  June  ist  of  that  year. 

The  income  of  the  fund  was  increased  by  the  requirement  of  one  per 
cent,  salary  contributions  of  all  entitled  to  pension  benefits,  limited  to  a 
maximum  of  $30  per  annum  for  teachers  and  principals,  and  $40  per  annum 
for  supervising  officials.  It  will  be  remembered  that  the  Brooklyn  teachers 
had  been  required,  until  1901,  to  make  such  a  contribution. 

The  new  law  omitted  the  requirement  that  absence  deductions  "shall 
be  fully  adequate  to  meet  the  demands  upon  the  Public  School  Teachers' 


87 


Retirement  Fund."  To  guarantee  the  safety  of  pensions  of  retired  teachers, 
it  limited  the  number  of  annual  retirements  so  that  the  entire  amount  of 
annuities  to  he  paid  in  any  one  year  should  not  exceed  the  estimated  income 
of  the  fund  in  that  year. 

A  Board  of  Retirement  was  created  and  its  powers  defined.  The 
benefits  were  substantially  liberalized.  The  requirement  of  thirty  years  of 
service  (twenty  in  the  city  of  New  York)  for  retirement  because  of  dis- 
ability was  reduced  to  twenty  years  (fifteen  in  the  city  of  New  York). 
For  retirement  at  age  65  after  thirty  years  of  service,  in  the  discretion,  of 
the  Board  of  Education,  the  law  omitted  the  requirement  that  twenty  of 
the  thirty  years  must  have  been  served  in  New  York  City.  An  entirely 
new  provision  was  added  for  retirement  upon  application  of  a  teacher  after 
thirty  years  of  service  (fifteen  in  New  York  City)  irrespective  of  age  or 
physical  condition. 

The  new  law  provided  that  all  retirements  after  thirty  years  were  to 
be  at  half  salary,  except  those  of  the  Hunter  College  stafif.  The  teachers' 
maximum  pension  was  raised  from  $1,000  to  $1,500,  as  at  present.  The 
application  of  the  $600  minimum  was  limited  to  retirement  after  a  service 
of  not  less  than  thirty  years.  For  shorter  periods  pensions  of  one-sixtieth 
of  the  final  salary  for  each  year  of  service  were  to  be  granted. 

In  the  definition  of  beneficiaries  of  the  fund,  the  teaching  and  super- 
vising staff  was  to  include  "the  city  superintendent  of  schools,  the  associate 
city  superintendents,  the  district  superintendents,  the  members  of  the  board 
of  examiners,  the  directors  and  assistant  directors  of  special  branches,  the 
supervisor  and  assistant  supervisor  of  lectures,  all  principals,  vice-prin- 
cipals, assistants  to  principals,  heads  of  departments  and  all  regular  and 
special  teachers  of  the  public  day  schools  of  the  city  of  New  York." 

The  provisions  for  the  retirement  of  the  members  of  the  Hunter  Col- 
lege staff,  including  special  privileges  afforded  the  president  and  professors, 
were  left  unchanged. 

The  first  Board  of  Retirement  was  organized  on  July  10,  1905,  some 
of  its  members  holding  their  membership  up  to  the  present  time.  The 
first  retirements  upon  the  recommendation  of  the  new  board  took  place  on 
February  i,  1906. 

The  laws  of  1907,  chapter  167,  reduced  the  period  of  service  of  Hunter 
College  applicants  for  disability  retirements  from  thirty  years  (ten  in  New 
York  City)  to  twenty  years  (ten  in  New  York  City),  and  added  a  pro- 
vision for  retirement  after  thirty  years'  service  upon  the  recommendation 
of  the  Trustees  of  Hunter  College,  in  the  discretion  of  the  Board  of  Edu- 
cation, omitting  the  requirement  exacted  in  the  case  of  public  school  teachers 
that  fifteen  of  the  thirty  years  shall  have  been  in  the  city  service. 

In  1909  (laws  of  1909,  chapter  505)  section  1092-b  of  the  present 
charter  was  added,  allowing  an  expenditure  of  not  exceeding  $1,500  per 
annum  for  the  administrative  expenses  of  the  fund. 

On  January  18,  191 1,  the  by-laws  of  the  Board  of  Education  were 

88 


amended  to  provide  for  the  compulsory  retirement,  without  the  recom- 
mendation of  the  Board  of  Retirement,  of  teachers  reaching  70  years  of 
age.  The  city  superintendent  submitted  the  first  list  of  21  teachers  who 
would  reach  70  years  of  age  on  or  before  February  i,  19 12,  and  the  Board 
of  Education  voted  to  retire  the  entire  21  as  of  that  date. 

The  laws  of  1914,  chapter  476,  added  to  those  eligible  to  participate 
in  the  retirement  fund,  the  director  and  assistant  director  of  the  Division 
of  Reference  and  Research  in  the  Department  of  Education. 

The  main  changes  in  the  benefit  and  income  provisions  of  the  fund 
are  presented  in  the  chart  on  the  following  pages. 


89 


Changes  in  Benefit  and  Income 


Benefit  and  Income  Provisions 


Benefits 

"Service"  pension,   without  proof 
of  incapacity: 
30  years'  service   (15  in  N.  Y. 

City  schools) 

30  years'  service  (no  minimum 
service  in  N.  Y.  City  schools).. 

30  years'  service  (10  years  in  N. 
Y.  City  schools) 

Compulsory  "superannuation"  pen- 
sion in  discretion  of  Board  of 
Education: 

Age  70,  after  30  years'  service  (no 
minimum  service  in  N.  Y.  City 
schools) 

Age  65,  after  30  years'  service  (no 
minimum  service  in  N.  Y.  City 
schools) 

Age  65,  after  30  years'  service  (20 
in  N.  Y.  City  schools) 

"Service"  and    "superannuation" 

pension: 

Women,   55   years    old    and    30 

years'  service  (20  years  Bklyn. 

schools) 

Men,  60  years  old  and  30  years' 
service  (20  years  Brooklyn 
schools) 

"Disability"  pension: 
Women,  after  30  years'  service  in 
N.  Y.  City  schools 

Men,  after  35  years'  service  in  N. 
Y.  City  schools 

30  years'  service  (20  years  in  N. 

Y.  City  schools) 

20  years'  service  (15  years  in  N. 

Y.  City  schools) 

30  years'  service  (no  minimum 
service  in  N.  Y.  City  schools) . 

30  years'  service  (10  years  in  N. 
Y.  City  schools) 

20  years'  service  (10  years  in  N. 
Y.  City  schools) 


Income 
Employees. 


City,  indirect  contributions. 


Others. 


1894 
Chapter  296 


N.  Y.,  H  salary 
max.,  11,000. 


N.  Y.,  H  salary; 
max.,  f  1,000. 


N.    Y.,    no  con 
tribution 


N.    Y.,   Absence 
deductions.. 


N.Y.,  Donations, 
&c. 


N.  Y.,  interest. 


1895 
Chapter  656 


Bklyn.,  J^  salary, 
max.  f  1,200 


Bklyn.,  J^  salary; 
max.,  11,200. .. 


Bklyn.,  1%  sal. 


1898 
Chapter  91 


N.  C,  ii  salary; 
max.  $1,000 


N.  Y.,  Excise 
taxes 

Bklyn.,  Excise 
taxes 


Bklyn.,    dona- 
tions, &c 

Bklyn.,  interest. 


1901 
Chapter  186 


N.  Y.,  ^  salary; 
min.,  1600; 
max.,  11,000... 


N.  Y.,  H  salary; 
min.,  $600; 
max.,  11,000.  ., 


N.  C,  H  salarv 
max.,  11,000... 


•Abbreviations:    N.     Y. — New    York    Teachers'     Fund     (1894  to     1901);     Bklyn. —  Brooklyn 
Teachers'  Fund   (1895  to  1901);   N.   C. — Normal  College. 

t  Minimum,  $600;  president  and  professors  receive  pension  of  even  multiple  of  $1,000. 

90 


Provisions — 1894  to  19 14,  inclusive  * 


1901 
Chapter  466 

1903 
Chapter  177 

1905 
Chapter  661 

1907 
Chapter  167 

Jan.  18,  1911 

By-Laws  of 

Board  of 

Education 

Present 
Provisions 

Discontinued 

N.    C,    not   less 
than  yi  salaryt- 

J^salary.t 

N.    C,    not   less 
than  ^  salaryt- 

Discontinued 

Discontinued. 

14  salaryt 

H  salary  .J 

H  salaryj. 

i^  saljiryj 

Discontinued 

Discontinued. 

Discontinued 

Discontinued. 

Discontinued.. . . 

Discontinued. 

Discontinued 

Discontinued. 

Discontinued 

Discontinued. 

H  salary} 

Discontinued 

1/60  of  salary  for 
each  yr.  of  serv. . 

1/60  of  salary  for 

each  yr.  of  serv. 

Discontinued 

N.    C,    not   less 

Discontinued. 

Discontinued. 

N.    C,    1/60   of 
salary  for  each 
year  of  service. 

N.  C,  1/60  of  sal- 
ary for  each  year 
of  service. 

No  contribution. 

No  contribution! 

1%  of  sal.;  max., 
$30  for  teach.  & 
princ. :  $40  suprv. 
officials 

1 

1%  of  sal.;    max., 
$30  for  teach,  and 

1 

princ;      $40     for 
superv.  officials. 

N.  C,  1%  of  sal. 
Absence  deductions 

N.  C,  1%  sal 

Absence     deduc- 

1 

j 

cise  taxes 

J 

I 

5%  of  excise  taxes. 

Donations,  &c. . . 

Donations,  &c. 

Interest 

Interest. 

t  Minimum  $6oo;  maximum,  $1,500  for  teachers  and  principals,  $2,000  for  supervising 
officials. 

§  Minimum,  $600;  maximum,  $1,000  for  teachers;  $1,500  for  principals;  $2,000  for  supervising 
officials. 

91 


Pensions  Increase  from  $12,633.34  in  1895  to  $1,183,397.08  in  1914 

The  effect  of  liberalizing  benefit  provisions  and  their  extension  to  new 
classes  of  beneficiaries  can  best  be  illustrated  by  the  following  statement  of 
pension  payments  made  annually  to  retired  teachers  :* 


y.  Pension  y  Pension 

^^^  Payments  ^^^^  Payments 

1895 $12,633 .34  1905 $526,502.36 

1896 42,595.07  1906 616,984.54 

1897 71,539.49  1907 689,390.64 

1898 102,157.04  1908 724,129.78 

1899 124,296.18  1909 777,800.85 

1900 214,563.57  1910 833,863.59 

1901 263,805.28  1911 880,389.83 

1902 343,017.13  1912 983,554.99 

1903 420,026.99  1913 1,108,874.30 

1904 477,418.74  1914 1,183,397.08 

Total  pensions $10,396,940.79 

Administrative  expenses 4,600 .  29 

Total  disbursements $10,401,541 .08 


Main  Causes  for  Rapid  Increase  in  Pension  Pajmients 

One  of  the  most  important  causes  for  the  rapid  increase  of  pension 
demands  in  the  past  as  well  as  of  payments  to  be  made  in  the  future  must  be 
attributed  to  the  growth  in  the  number  of  teachers  in  active  service.  The 
strength  of  the  teaching  and  supervising  force  subject  to  the  retirement  laws 
increased  at  the  end  of  the  school  years  1899  to  1914  (July  31st)  as  follows: 


y  Number  of  y  Number  of 

^^^^  Employees  ^^^^  Employees 

1899 10,008  1907 15,728 

1900 10,555  1908 16,655 

1901 11,338  1909 17,244 

1902 12,161  1910 17,907 

1903 12,792  1911 18,369 

1904 13,428  1912 19,073 

1905 13,888  1913 19,681 

1906 14,660  1914 t20,588 


In  addition  to  the  rapid  growth  of  the  active  force,  a  number  of  other 
conditions  have  caused  sudden  increases  in  the  annual  pension  demands.    The 


*  For  details  consult  Table  6,  page   113. 
t  As  of  June  30,   1914. 


92 


first  of  these  increases,  when  the  fund  had  time  to  settle  to  normal  conditions 
after  the  first  few  years  of  operation,  occurred  in  1900,  the  pension  payments 
for  that  year  amounting  to  $214,563.57  as  against  $124,296.18  in  1899.  This 
was  due  to  an  increase  in  salary  schedules  in  1899.  In  the  next  year  the 
salary  schedules  were  to  be  reduced,  and  as  a  result  108  teachers  retired  on 
December  31,  1899,  to  avoid  substantial  reduction  in  retirement  allowances. 

The  increases  in  1902  and  1903  are  directly  traceable  to  the  effect  of 
more  liberal  retirement  provisions  introduced  on  the  consolidation  of  the 
New  York  and  Brooklyn  funds  in  1901.  The  removal  of  the  age  limitations 
and  the  reduction  of  the  minimum  years  of  service  enabled  a  greater  number 
to  apply  for  retirement.  The  increase  in  the  maximum  pensions  from  $1,000 
in  the  old  New  York  fund  and  $1,200  in  the  Brooklyn  fund  to  $2,000  granted 
from  the  consolidated  fund  raised  the  average  amount  of  newly  added  annui- 
ties. Finally,  the  application  of  the  minimum  limit  of  $600  to  pensions 
granted  in  the  past  raised  the  annual  charge  for  already  existing  pensions  by 
$16,590.  Of  this  amount  $13,035  represented  the  retroactive  increase  in  1901 
of  pensions  granted  from  the  old  New  York  fund  and  $3,555,  the  added 
charge  in  1902  on  account  of  past  retirements  from  the  Brooklyn  fund. 

The  next  substantial  increases  in  the  annual  pension  expenditures 
occurred  in  1906  and  1907,  the  pension  roll  rising  from  $526,502.36  in  1905 
to  $616,984.54  in  1906  and  to  $689,390.64  in  1907 — an  increase  of  $162,888.28 
during  the  two  years.  It  will  be  remembered  that  in  1905  the  fund  was  reor- 
ganized along  lines  more  liberal  even  than  those  prevailing  before  that  date. 
The  right  to  retirement  after  thirty  years  on  application  without  proof  of 
mcapacity,  and  the  reduction  of  the  service  requirement  to  twenty  years  in 
case  of  retirement  for  disability  which  was  certified  to  by  the  applicant's 
home  physician,  were  the  main  causes,  inducing  a  large  number  of  teachers 
to  avail  themselves  of  the  retirement  privileges. 

On  January  i,  1912,  the  "equal  pay'^  law  came  into  effect  substantially 
raising  existing  salary  rates.  Teachers  who  had  contemplated  retirement  in 
the  immediate  past,  but  were  waiting  for  the  new  law  to  be  passed,  were  now 
ready  to  be  placed  on  the  pension  roll  at  half  the  salary  received  but  a  few 
months  before  retiring  from  the  service.  The  increases  of  $103,165.16  and 
$125,319.31  in  the  pension  payments  of  1912  and  1913  over  the  preceding 
years  illustrate  the  extent  to  which  the  "equal  pay"  law  increased  the  liabili- 
ties of  the  fund. 

In  the  following  year  the  helpless  financial  condition  of  the  fund  was  so 
apparent  that  the  retirements  were  somewhat  restricted.  As  a  result,  only 
42  teachers  were  retired  on  February  i,  1914,  and  50  teachers  on  September 
I,  1914.  The  added  pensions  caused  the  pension  payments  in  1914  to  rise  to 
$1,183,397.08,  exceeding  the  1913  pensions  only  by  about  $74,522.78. 

In  order  to  facilitate  the  study  of  the  rapid  increase  of  the  pension 
charge  in  the  past,  the  fluctuations  in  the  number  of  annual  retirements,  the 
average  pension  granted  each  year  and  the  total  pension  charge  assumed  on 
account  of  yearly  added  pensions  are  given  in  the  following  statements : 

98 


35 

$594.84 

$20,819.50 

63 

600.70 

37,844.00 

77 

580.74 

44,717.00 

29 

695.88 

20,180.50 

134 

716.81 

96,052.00 

42 

768.33 

32,270.00 

78 

738.27 

57,585.00 

121 

843.72 

102,090.00 

97 

816.29 

79,180.00 

112 

787.77 

88,230.00 

38 

818.42 

31,100.00 

197 

746.74 

147,107.99 

86 

787.85 

67,754.81 

98 

739.35 

72,456.21 

127 

787.58 

100,023.09 

109 

732.89 

79,884.67 

89 

719.69 

64,052.39 

222 

887.07 

196,928.29 

173 

889.02 

153,800.78 

92 

948.38 

87,250.60 

Number  Re-  Average  Total  Annual 

Year  tired  During  Annuity  Charge  of 

the  Year  Granted         Annuities  Granted 

1895 

1896 

1897 

1898 

1899 

1900 

1901 ; 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 

1913 

1914 


City  Contributed  80  Per  Cent,  of  Income  of  Fund 

A  detailed  statement  of  the  receipts  of  the  fund  since  the  date  of  its 
establishment  in  1894,  a  statement  showing  absence  deductions,  refunds  and 
net  deductions,  an  analyzed  statement  of  receipts  and  disbursements,  and  a 
statement  of  surpluses,  deficits  and  balances  are  presented  in  Tables  7, 
8,  9  and  10,  pages  114  to  117,  respectively.  The  separate  transactions  of 
the  old  New  York  and  Brooklyn  funds  up  to  1901  have  been  combined,  and 
the  statements  therefore  represent  the  financial  pension  operations  on  account 
of  both  teachers'  funds  since  1894. 

A  summary  of  the  receipts  during  the  twenty-one  year  period  of  the 
fund's  existence  follows : 

Per  Cent 
Items  of  Receipts  Amount  ^£  Total' 

Employees'  Contributions $2,222,624.98  19.65 

1%  salary  contributions  of  Brooklyn  teachers  from  1896 

to  1901,  inclusive 158,861 .76 

1%  salary  contributions  of  all  teachers  from  June  1,  1905, 

to  December  31,  1914 2,063,763.22 

Indirect  City  Contributions 8,510,280.94  75.26 

Unrefunded  absence  deductions  since  1894 3,743,903 .  16 

Fines  since  1910 1,818.58 

Excise  licenses  since  1899 4,764,559.20 

Donations  and  Bequests 1,144.88  .01 

Interest 574,095.85  5.08 

Total  Receipts $11,308,146.65  100.00 

From  the  above,  it  will  be  seen  that  about  eighty  per  cent,  of  all  receipts 
of  the  fund  were  contributed  by  the  city,  including  the  amount  of  interest 

94 


which  accrued  from  a  permanent  fund  of  $800,000  set  aside  in  1905,  and 
which  represented  mainly  the  accumulations  of  city  contributions. 

Depletion  of  Fund  Begins  in  1910 

As  will  be  seen  from  the  facts  presented  in  Table  10,  page  117,  the  fund 
was  accumulating  a  surplus  until  1909,  at  the  close  of  which  year  the  balance 
in  the  fund  amounted  to  $1,353,305.70,  including  the  $800,000  permanent 
fund  set  aside  by  legislative  act  in  1905. 

Beginning  with  the  year  1910,  however,  the  surplus  capital  began  to 
be  depleted,  the  annual  receipts  falling  short  of  the  annual  disbursements  in 
amounts  as  follows : 


Year  ^Xft  ^^^^  at  End 


Balance  in 
md  at  E: 
of  Year 


1910 $48,142.95  $1,305,162.75 

1911 77,337.53  1,227,825.22 

1912 134,773.71  1,093,051.51 

1913 79,380.46  1,013,671 .05 

1914 107,065.48  906,605.57 

During  the  last  two  years,  1913  and  1914,  the  continuation  of  the  fund's 
existence  was  made  possible  only  by  extraordinary  measures  which  merely 
postponed  its  complete  breakdown. 

In  19 13  the  advance  to  the  fund  of  $200,000  of  excise  moneys  which 
would  have  been  received  under  prevailing  practice  in  January,  1914,  enabled 
it  to  pay  pensions,  although  the  surplus  fund  was  further  reduced  by 
$79,380.46. 

In  1914,  in  addition  to  the  advance  of  excise  moneys,  the  embargo  on 
refunds  imposed  by  the  by-laws  of  the  Board  of  Education  since  September 
24,  1913  (see  Table  8,  page  115),  and  the  curtailment  of  1914  retirements 
(only  92  pensioners  were  added  to  the  roll),  helped  the  fund  barely  to 
meet  its  most  pressing  obligations  to  teachers  already  retired. 

Present  Bankruptcy  Hastened  by  Payment  of  $160,000  of  Refunds  in 
1915 

Table  11,  pages  118  and  119,  shows  the  actual  receipts  and  disburse- 
ments of  the  fund  during  the  first  seven  months  of  191 5  and  its  estimated 
transactions  during  the  balance  of  the  year. 

This  statement  has  been  compiled  from  the  books  of  the  Finance  Depart- 
ment, the  balances  of  which  do  not  agree  with  those  shown  on  the  books  of 
the  auditor's  office  of  the  Department  of  Education.  This  is  due  to  the  fact 
that  a  number  of  items  originate  in  the  Board  of  Education,  while  others 
are  first  entered  on  the  books  of  the  Finance  Department,  resulting  in 
differences  in  the  accounts  because  of  vouchers  or  information  in  transit. 
The  balance  of  $29,841.09  shown  in  Table  11,  as  of  January  i,  1915,  is 

95 


exclusive  of  the  $800,000  permanent  reserve  capital  which  is  not  available 
for  the  payment  of  pensions  and  which  cannot  be  released  except  by  legis- 
lative action.  The  balance  also  omits  the  December,  1914,  contributions  of 
employees  and  gross  absence  deductions,  as  well  as  some  minor  items  which 
were  not  actually  turned  over  to  the  fund  until  191 5,  although  they  were 
credited  on  the  books  of  the  Department  of  Education  for  the  months  when 
the  items  accrued. 

As  shown  by  the  statement  referred  to  (Table  11),  a  total  of  $160,- 
658.73  was  paid  out  in  refunds  of  absence  deductions  during  the  first 
seven  months  of  1915.  This  extra  drain  on  the  fund,  which  could  have  been 
postponed  until  relief  from  the  legislature  was  obtained  in  1916,  hastened 
the  exhaustion  of  the  fund. 

Teachers  Allowed  Leaves  of  Absence  with  Half -pay  in  Lieu  of  Retire- 
ment 

No  pensions  were  granted  in  191 5.  Instead,  teachers  applying  for 
retirement  were  allowed  leave  of  absence  for  one  year  on  half  pay.  The 
number  of  teachers  placed  in  this  manner  on  the  "unofficial"  retirement  list 
during  the  first  half  of  the  year  was  42,  the  average  annual  "half  pay"  was 
$938.43,  and  the  total  annual  charge  paid  from  the  general  fund  of  the 
Department  of  Education  was  $39,414.24. 

Pensions  Increased  to  4.15  Per  Cent,  of  Active  Pa3rroll 

The  growth  of  the  pension  fund  during  the  ten  year  period  1905  to  19 14 
as  compared  with  the  growth  of  the  active  force  is  indicated  by  Table 
12,  page  120.  It  must  be  kept  in  mind  that  payroll  payments  are  for  cur- 
rent services,  while  pension  payments  are  for  services  rendered  in  the  past. 
Although  there  is  no  direct  or  immediate  relation  between  the  two,  the 
comparison  serves  as  a  basis  for  a  proper  appreciation  of  the  growth  of 
pension  demands. 

In  1906  for  every  $100  expended  for  the  services  of  active  teachers  $3.65 
was  paid  for  pensions  accruing  for  services  rendered  in  the  past.  This  rela- 
tive amount  gradually  increased  until  in  1914  for  every  $100  paid  in  salaries 
$4.15  was  required  for  the  payment  of  pensions.  The  increase  is  explained 
by  the  fact  that  more  pensions  are  added  to  the  roll  each  year  than  terminate 
on  account  of  death.  It  is  the  more  noteworthy  because  the  active  payroll 
has  been  increasing  at  a  rapid  rate  during  the  same  period — a  factor  which 
tends  to  lower  the  percentage  proportion  of  pension  payments. 

1,549  Retired  Teachers  Draw  Average  Pension  of  $784.53  at  Close  of  1914 

On  December  31,  1914,  there  were  1,549  retired  teachers  on  the  pension 
roll.  The  distribution  of  benefits  among  these  pensioners  is  shown  in  detail 
in  Table  13,  page  121.  The  total  annual  charge  was  $1,215,231.11.  Pensions 
ranging  between  $402.39  and  $5,000  per  annurn  were  paid  in  groups  as  fol- 
lows: 

96 


Annual  Pension  Number  ^^^  ^^^ 

$402.39  and  less  than     $600 150  9.6 

600           "      "       "       1,000 1,165  75.2 

1,000          "      "       "       1,750 226  14.6 

1,750          "      "       "       2,500 6  0.4 

3,000 1  0.1 

5,000 1  0.1 


Total 1,549  100.0 

The  first  group  consists  entirely  of  teachers  retired  for  disability  after 
less  than  thirty  years  of  service,  at  the  rate  of  i/6o  of  the  final  salary  for 
each  year  of  service.  The  minimum  limitation  of  $6oo  per  annum  does  not 
apply  to  this  group. 

The  majority  of  pensioners  in  the  second  group  are  elementary  school 
teachers.  Those  retired  under  the  old  salary  schedules  prior  to  19 12  are 
mostly  drawing  a  pension  of  $660  per  annum.  The  majority  of  those  pen- 
sioned after  the  introduction  of  the  "equal  pay"  law  are  in  receipt  of 
pensions  of  $750,  $800,  $910  and  $960  per  annum. 

The  third  group  consists  of  teachers  who  reached  the  higher  grades 
before  retirement  and  principals  whose  pensions  are  limited  by  law  to  $1,500 
per  annum.  Supervising  officials  limited  to  a  maximum  pension  of  $2,000 
per  annum  are  in  the  fourth  group,  while  a  former  professor  of  Hunter 
College  is  drawing  $3,000  and  the  ex-president  of  Hunter  College  $5,000  per 
annum.* 

Average  Present  Age  of  Men  and  Women  Pensioners 

Tables  14  and  15,  pages  121  and  122,  contain  a  classification  of  all  re- 
tired teachers  on  the  rolls  on  June  30,  1914,  by  sex,  cause  of  retirement  and 
present  age.  The  average  present  age  of  men  pensionrs  is  69.50  years  and  of 
women  pensioners  62.05  years.  A  summary  of  these  tables  is  presented 
below  : 

Average 
Class  of  Pensioners  Number  Present 

Age 

Total  Pensioners 1,521  62.46 

Men  pensioners 

Women  pensioners 

"Service' '  pensioners 

Men  pensioners 

Women  pensioners 

"Disability' '  pensioners 

Men  pensioners 11  57 .00 

Women  pensioners 278  51 .83 

*  Died  Oct.  14,  1915. 

97 


82 
1,439 

69.50 
62.05 

1,232 

*     64.90 

71 
1,161 

71.44 
64.50 

289 

52.03 

Average  Age  at  Retirement  for  "Service"  of  Men  and  Women  Pen- 
sioners 

Tables  i6  and  17,  pages  122  and  123,  show  a  classification  of  teachers 
who  retired  because  of  length  of  service,  by  sex,  service  prior  to  retirement, 
age  at  appointment  and  age  at  retirement.  The  information  presented  is 
summarized  as  follows : 


Average  Age  Average  Average 

Class  of  Pensioners  NiHnber  at  Years  of         Age  at  Re- 

Appointment  Service  tirement 

Men  pensioners 71  33.10  33.80  66.90 

Women  pensioners 1,161  21 .21  36 .04  57 .25 

An  inspection  of  the  above  figures  shows  that  men  teachers  continue  in 
service  until  a  much  later  period  in  life  than  women  teachers.  Their 
pensions,  therefore,  are  less  costly,  provided  they  are  of  the  same  amounts, 
since  the  period  of  their  retirement  is  on  the  average  much  shorter  than  that 
of  the  women  teachers. 

Another  interesting  point  is  brought  out  by  the  tables  referred  to.  The 
tabulations  include,  under  years  of  service,  only  the  time  served  in  New 
York  schools,  and  the  age  at  appointment  refers  only  to  entrance  into  New 
York  schools.  Teachers  whose  service  is  shown  as  less  than  thirty  years  had 
teaching  experience  outside  of  New  York  City  which  was  credited  for  retire- 
ment by  the  fund.  The  following  facts  supplement,  therefore,  the  summary 
above  presented: 


Men  Women 

Pensioners  Pensioners 

Number  of  pensioners  with  less  than  30  years'  service  in  New 

York  City  schools 26  103 

Ntmiber  of  pensioners  with  30  or  more  years  of  service  in  New 

York  City  schools 45  1,058 

Per  cent,  of  pensioners  with  less  than  30  years'  service  in  New 

York  City  schools 57.8%  9.7% 

Average  entrance  age  of  those  with  30  or  more  years  of  service 

in  New  York  City  schools 26.40  years        19.73  years 

Average  service  of  those  with  30  or  more  years  of  service  in 

New  York  City  schools 41 .69  years        37.40  years 

Average  retirement  age  of  those  with  30  or  more  years  of 

service  in  New  York  City  schools 68 .09  years        57 .  13  years 


Average  Age  at  Retirement  for  "Disability"  of  Men  and  Women  Pen- 
sioners 

The  details  of  the  retirement  of  teachers  for  disability  are  presented  in 
Tables  18  and  19,  pages  123  and  124.  The  information  presented  is  sum- 
marized as  follows: 

98 


Average  Average  Average 
Class  of  Pensioners               Number                 Age  at  Years  of  Age  at  Re- 
Appointment            Service  tirement 

Men  pensioners 11  36.27  18.55  54.82 

Women  pensioners 278  24.36  24.03  48.39 


The  comparatively  small  number  of  disability  pensioners  on  the  roll 
(19  per  cent,  of  the  total  number  of  1,521  pensioners)  is  explained  by  the 
fact  that  only  since  February  i,  1906,  did  the  provision  permitting  retire- 
ment for  disability  after  twenty  years'  service  (fifteen  in  the  city  of  New 
York)  come  into  effect,  while  the  provision  for  retirement  after  thirty  years' 
service  was  a  feature  of  the  pension  plan  since  its  establishment. 

Attention  is  also  called  to  the  fact  that  those  pensioners  who  are  shown 
in  the  two  tabulations  (Tables  18  and  19,  pages  123  and  124)  as  having 
served  less  than  twenty  years  must  have  had  outside  experience  to  have 
qualified  for  disability  retirement. 


99 


CHAPTER  XI 
UNSUCCESSFUL    REORGANIZATION   ATTEMPTS 

Recurrence  of  Past  Errors  Must  be  Avoided 

Efforts  have  been  made  in  the  past  six  years  by  teachers  as  well  as  by 
the  government  to  amend  the  present  retirement  law.  Disregarding  for  the 
present  the  question  of  the  soundness  of  proposed  amendments,  the  most  sig- 
nificant feature  of  the  past  and  present  agitation  is  the  inability  of  individual 
teachers  and  groups  of  teachers  to  unite  on  any  definite  policy. 

To  save  the  fund  and  to  place  it  on  an  equitable  and  financially  sound 
basis,  the  sincere  and  earnest  cooperation  of  all  concerned  is  required. 

Grave  errors  in  the  development  of  teachers'  pension  funds  in  this 
country  and  consequent  failures*  have  so  far  made  no  impression  on  the 
teachers  of  the  city  of  New  York.  Now  that  their  own  fund  is  in  a  pre- 
carious condition,  it  is  hoped  that  an  effort  will  be  made  by  the  teachers  to 
unite  in  an  intelligent  constructive  movement. 

With  no  desire  to  locate  responsibility  and  merely  for  the  purpose  of 
pointing  out  the  mistakes  which  must  be  avoided  to  obtain  good  results,  this 
chapter  is  devoted  to  a  brief  account  of  the  unsuccessful  reorganization 
attempts  of  the  past. 


Increased  Benefits  Demanded  Despite  Knowledge  of  Insolvency 

During  the  years  1908  and  1909,  repeated  efforts  were  made  by  the 
teachers  to  increase  retirement  benefits,  which  culminated  in  the  introduc- 
tion of  a  bill  in  the  legislature  by  Assemblyman  Brennan.  The  bill  passed, 
but  was  vetoed  by  Mayor  Gaynor.  If  the  bill  had  become  effective,  the 
present  bankruptcy  of  the  fund  would  have  occurred  a  year  or  so  sooner. 
Mayor  Gaynor  gave  the  following  reason  for  his  veto : 

"There  is  so  much  diversity  of  opinion  among  the  teachers  them- 
selves, who  are  to  be  the  beneficiaries  of  this  bill,  that  I  think  it  better 
to  withhold  my  acceptance  of  it  and  give  the  teachers  time  to  get 
together  and  agree  upon  a  bill  acceptable  to  all." 

The  bill  in  question  provided  the  following  increased  benefits : 

1.  An  increase  of  the  minimum  pension  from  $600  to  $750. 

2.  The  minimum  annuity  for  principals  was  set  at  $1,500  (women 
principals  were  then  receiving  $2,500,  and  the  proposed  law  was  to  pro- 
vide for  retirement  at  more  than  one-half  final  salary). 

•    Virginia,  Maryland,  Cincinnati,   San  Francisco,  Boston,  Providence,  Newport,  etc. 

100 


3-  The  maximum  limits  for  pensions  to  teachers  and  principals  of 
$1,500  and  to  supervising  officials  of  $2,000  were  to  be  removed  by  pro- 
viding that  all  persons  retired  after  30  years  were  to  receive  one-half  of 
final  salary.  This  would  have  permitted  the  retirement  of  the  city  super- 
intendent at  $5,000  and  a  number  of  other  supervising  officials  on  annui- 
ties of  $3,250  and  $2,500  per  annum. 

As  an  offset  to  the  increased  benefits,  the  bill  provided  that  all  teach- 
ers, principals  and  supervisors  should  contribute  i  per  cent,  of  their  salaries, 
removing  the  maximum  contribution  of  $30  per  annum  for  teachers  and 
principals  and  $40  per  annum  for  supervisors. 

The  proposed  increased  contributions  by  no  means  offset  the  contem- 
plated benefit  increases.  As  a  matter  of  fact,  no  calculations  were  made  to 
determine  how  far  the  increased  income  from  the  i  per  cent,  contributions  of 
principals  and  supervisors  would  go  towards  defraying  the  added  expense. 

A  committee  of  the  Board  of  Retirement  prepared  a  tentative  estimate 
of  the  effect  of  the  proposed  amendment  on  the  financial  operation  of  the 
fund,  and  found  that  it  would  result  in  substantial  deficits.  This  warning, 
however,  was  not  heeded,  the  bill  being  forced  through  the  legislature  and 
only  dissension  among  the  teachers  themselves  bringing  about  its  final 
failure. 

The  first  deficit  of  the  fund,  which  occurred  in  1910  and  became  gener- 
ally known  early  in  191 1,  gave  renewed  impetus  to  the  ever-growing  activities 
of  the  teachers  for  pension  reorganization.  A  general  representative  commit- 
tee of  about  80  teachers  was  formed,  which  undertook  by  means  of  question- 
naires to  determine  the  attitude  of  teachers  toward  a  number  of  constructive 
suggestions. 

Suggestions  to  increase  the  one  per  cent,  contributions  were  emphatic- 
ally voted  down.  The  unrefunded  absence  deductions,  i.  e.,  pay  for  services 
not  rendered  and  absences  not  excused,  were  held  to  be  contributions  of  the 
teachers  and  not  of  the  city.  The  suggestion,  that  these  "teachers' "  contri- 
butions as  well  as  their  i  per  cent,  salary  deductions  should  be  "matched"  by 
the  city,  received  an  overwhelming  affirmative  answer. 

The  resulting  bill  provided  for  the  following  increased  benefits : 

1.  Vested  rights  of  teachers  to  retire  after  30  years'  service  (15  in 
New  York  City)  if  55  years  old. 

2.  Minimum  pensions  to  be  granted  after  30  years  of  service,  $750 
for  teachers,  $1,000  for  heads  of  departments,  $1,500  for  principals. 

3.  Removal  of  maximum  pension  limit. 

The  remaining  benefit  provisions  of  the  existing  law  were  allowed  to 
stand  almost  unchanged. 

The  contributions  of  the  teachers  were  to  be  increased  as  follows : 

I  per  cent,  of  salary — those  in  the  service  less  than  20  years  and 
receiving  less  than  $3,500  per  annum. 

101 


2  per  cent,  of  salary — those  in  the  service  more  than  20  years  and 
receiving  less  than  $3,500  per  annum,  and  those  receiving  more  than 
$3,500  and  less  than  $5,000  per  annum. 

3  per  cent,  of  salary — those  receiving  salary  of  more  than  $5,000 
per  annum. 

While  the  above  percentages  look  impressive,  they  would  have  accord- 
ing to  a  rough  calculation  effected  a  probable  increase  in  income  of  approxi- 
mately only  one-half  per  cent.,  as  the  i  per  cent,  salary  contributions  were  to 
apply,  as  before,  to  the  bulk  of  the  service,  and  only  a  small  number  of  teach- 
ers were  to  make  2  per  cent,  and  3  per  cent,  contributions. 

The  unrefunded  absence  deductions  were  to  remain  a  source  of  income 
while  the  payment  of  excise  moneys  into  the  fund  was  to  be  discontinued. 
The  city  was,  however,  to  appropriate  annually  an  amount  equal  to  the 
amount  of  the  percentage  contributions  of  teachers  and  the  unrefunded  ab- 
sence deductions,  the  latter  item  being  considered  a  contribution  by  the 
teachers. 

The  total  income  of  the  fund  under  the  proposed  provisions  would  have 
amounted,  roughly,  to  about  5  per  cent,  of  the  payroll,  of  which  only  i^  per 
cent,  would  have  been  contributed  by  the  teachers.  The  changes  in  benefits 
were  by  no  means  offset  by  the  slightly  increased  income,  and  if  the  bill  had 
become  a  law,  the  fund  would  have  become  more  seriously  involved  than  at 
present. 

The  introduction  of  the  pension  provisions  of  the  "Gaynor"  Charter  Bill 
containing  provisions  for  the  amalgamation  of  all  city  pension  funds  pre- 
vented the  consideration  of  the  teachers'  bill.  The  teachers  directed  all  their 
energies  to  block  the  enactment  of  the  pension  sections  of  the  "Gaynor"  bill. 
Not  only  did  this  bill  provide  for  a  centralized  administration,  but  it  pro- 
posed that  all  employees  contribute  2  per  cent,  of  their  salaries,  the  city 
assuming  responsibility  for  meeting  deficiencies.  As  the  teachers'  pensions 
will  eventually  cost  20  per  cent,  of  the  payroll,  the  bill  providing  for 
teachers'  contributions  of  only  2  per  cent.,  the  city  assuming  the  ever- 
increasing  difference,  was  a  decided  bargain  for  the  teachers  from  the 
financial  standpoint.  The  actual  cost  of  pensions,  however,  was  never 
realized,  and,  in  addition,  the  power  of  the  proposed  pension  board  to 
reduce  and  terminate  pensions  appeared  to  the  teachers  such  an  encroach- 
ment on  their  existing  rights  that  effective  opposition  was  deemed  essential. 

In  the  meantime  the  fund's  condition  grew  worse.  The  second  annual 
deficit  in  191 1  further  reduced  the  balance  of  the  fund  and  left  only 
a  small  margin  over  the  reserve  capital  of  $800,000  which,  according  to 
law,  cannot  be  applied  to  the  payment  of  pensions.  In  1912,  general  appre- 
hension arose,  and  though  agitation  for  increased  benefits,  especially  half- 
pay  pensions  for  all,  continued  as  usual  on  the  part  of  small  groups  of  teach- 
ers, the  majority  of  the  force  favored  an  actuarial  investigation  of  the  fund. 
The  Brooklyn  Class  Teachers'  Organization  secured  in  February,  1912,  an 
opinion  from  an  actuary  that  the  fund  was  in  a  depleted  condition.    Finally, 

102 


in  June,  1912,  Wm.  A.  Hutcheson,  Actuary  of  the  Mutual  Life  Insurance 
Company  was  retained  by  the  Board  of  Retirement  to  investigate  the  fund. 

In  the  meantime,  the  fund's  disbursements  in  1912  again  exceeded  its 
receipts  and  the  balance  was  still  further  reduced.  In  May,  1913,  the  Conih 
missioners  of  Accounts  submitted  a  report  on  a  survey  made  of  all  New  York 
City  pension  funds,  disclosing  urgent  need  for  reorganization.  In  June  of 
the  same  year  Mayor  Gaynor  appointed  a  commission  to  study  the  operation 
of  existing  pension  funds  and  to  work  out  constructive  recommendations. 
In  September,  1913,  the  Board  of  Education  discontinued  temporarily  the 
refund  of  absence  deductions  to  enable  it  to  pay  current  pensions. 

On  October  i,  1913,  the  actuary,  Wm.  A.  Hutcheson,  submitted  his 
report  to  the  Board  of  Education,  in  which  the  fund's  insolvency  was  ex- 
haustively demonstrated  and  a  number  of  constructive  suggestions  for  its 
rehabilitation  submitted. 

A  special  committee  of  the  Board  of  Retirement  was  instructed  to  draw 
up  a  bill  for  the  amendment  of  the  retirement  law.  Although  the  resulting 
constructive  plan  was  meant  only  as  a  temporary  measure  of  relief,  it  almost 
entirely  disregarded  the  advice  of  the  actuary.  Its  enactment  would  simply 
have  postponed  the  present  crisis  for  a  number  of  years  when  reorganization 
would  be  more  difficult  because  of  increased  deficiencies. 

The  benefits  suggested  in  the  bill  were  as  follows : 

1.  Retirement  without  proof  of  incapacity  after  30  years'  service 

(20  in  the  city  of  New  York) — women  if  55  years  old  and 
men  if  60  years  old — on  a  pension  of  i^  per  cent,  of  final 
salary  for  each  year  of  service.  Minimum  pension,  $600; 
maximum,  ^  final  salary,  not  to  exceed  $3,000  per  annum. 

2.  Disability  retirement  after  20  years'  service  (minimum,  20  years 

in  the  city  of  New  York)  upon  proof  of  incapacity  certified 
to  by  departmental  physician — on  pension  calculated  in  same 
manner  as  above. 

The  income  was  to  be  increased  as  follows : 
Contributions  by  teachers 

2  per  cent,  of  salary — those  in  the  service  less  than  10  years  and 

receiving  less  than  $3,000  per  annum 

3  per  cent,  of  salary — those  in  the  service  more  than  10  years  and 

less  than  20  years,  and  those  receiving  more  than  $3,000  and 
less  than  $5,000  per  annum 

4  per  cent,  of  salary — those  in  the  service  more  than  20  years  and 

receiving  more  than  $5,000  per  annum 

Contributions  by  the  city 

Absence  deductions  of  teachers  as  before 

7  per  cent,  of  excise  moneys,  instead  of  5  per  cent,  as  contributed  in 
the  past 

103 


This  plan,  which  included  additional  unimportant  changes,  was  unoffi- 
cially submitted  to  the  actuary,  Mr.  Hutcheson,  who  characterized  the  pro- 
posed changes  as  unsound,  and  stated  that  if  adopted  the  fund  would  in  a 
few  years  be  unable  to  meet  its  obligations. 

Preparations  were  made,  however,  to  introduce  the  bill  in  the  legis- 
lature. The  Board  of  Estimate  adopted  on  January  i6,  1914,  a  resolution 
requesting  the  legislature  and  the  city  departments  not  to  consider  any 
proposed  pension  legislation  until  the  Mayor's  Commission  on  Pensions  had 
reported  its  findings  and  recommendations.  In  compliance  with  this  resolu- 
tion, no  further  efforts  were  made  to  place  the  proposed  amendment  on 
the  statute  books. 

Rejected  Plans  for  Temporary  Adjustment 

After  a  preliminary  survey  of  the  existing  pension  situation  and  a  num- 
ber of  hearings  given  to  city  employees  to  express  their  views  on  the  pension 
problem,  the  Mayor's  Pension  Commission  realized  the  necessity  of  obtaining 
a  reliable  basis  of  fact  before  it  could  intelligently  propose  constructive  sug- 
gestions. 

Accordingly,  on  March  18,  1914,  a  staff  was  organized  for  the  collection 
and  analysis  of  data,  and  the  preparation  of  actuarial  cost  computations.  A 
census  of  the  entire  municipal  service  as  of  June  30,  1914,  and  of  those  who 
left  the  service  during  the  six-year  period  July  i,  1908,  to  June  30,  1914, 
was  undertaken.  This  fact  basis  made  it  possible  to  calculate  the  necessary 
rates,  such  as  mortality  in  active  service,  mortality  of  pensioners,  withdrawals 
from  the  service  without  pension,  retirement  on  pension,  etc.  As  the  cost 
calculations  could  not  be  completed,  however,  in  time  to  furnish  a  basis  for 
the  immediate  permanent  reconstruction  of  the  teachers'  retirement  fund, 
which  was  in  a  critical  condition,  the  staff  of  the  pension  commission  was 
instructed  by  its  secretary  to  study  the  operation  of  the  teachers'  fund  with 
a  view  to  suggesting  alternatives  for  temporary  relief. 

In  May,  19 14,  at  a  conference  of  members  of  the  Board  of  Education, 
the  Board  of  Retirement,  the  Pension  Commission  and  the  Comptroller,  cal- 
culations were  submitted  showing  that  the  fund  could  continue  its  operation 
until  late  in  1916  under  the  condition  that: 

1.  Future  retirements  should  be  limited  to: 

(a)  50  teachers  on  September  i,  1914,  at  an  average  annuity 

of  $888; 

(b)  75  teachers  on  February  i,  191 5,  at  an  average  annuity 

of  $888; 

(c)  75  teachers  on  September  i,  191 5,  at  an  average  annuity 

of  $888; 

2.  No  refunds  of  absence  deductions  be  made  during  the  balance 

of  1914  and  the  entire  year  1915; 

3.  Teachers  contribute  2  per  cent,  of  salaries  beginning  February 

I,  1915- 

104 


The  further  postponement  of  the  payment  of  refunds  of  absence  deduc- 
tions (they  were  held  up  by  a  ruling  of  the  Board  of  Education  since  Septem- 
ber 25,  1913)  was  considered  by  the  school  officials  as  a  hardship  to  teachers, 
and  an  understanding  was  reached  with  the  Comptroller  by  which  a  special 
committee  was  to  review  applications  for  refunds  of  absence  deductions. 
This  committee  reported  in  November,  1914,  as  follows : 

Total  deductions  for  absence  from  September 

25,  1913,  to  June  30,  1914 $504,422.74 

Refunds  of  deductions  recommended. .......   152,586.32 

On  September  i,  19 14,  50  new  retirements  were  made,  but  the  sugges- 
tion for  the  increase  of  contributions  to  2  per  cent,  was  not  acted  upon. 

Early  in  19 15  the  fund  was  rapidly  approaching  the  final  stage  of  col- 
lapse and  the  situation  was  discussed  in  a  series  of  conferences  between  a 
special  committee  of  the  Board  of  Education,  the  Board  of  Retirement, 
the  president  of  the  Board  of  Education,  the  Comptroller  and  the  Cham- 
berlain, Following  these  conferences,  cost  estimates  of  several  alleviative 
alternatives  were  made  by  the  staff  of  the  pension  commission.  Finally, 
it  was  agreed  to  by  the  Comptroller  that  the  Board  of  Estimate  request  the 
legislature  to  require  the  city  to  pay  annually  a  flat  sum  equal  to  the  average 
contributions  made  indirectly  by  the  city  through  excise  taxes  and  deduc- 
tions from  teachers'  salaries  for  absence  from  1909  to  19 13  inclusive,  and 
that  the  percentage  contributions  from  teachers  be  increased  sufficiently  to 
provide  for  the  obligations  of  the  fund. 

With  this  understanding,  the  staff  of  the  pension  commission  calculated 
the  prospective  requirements  of  the  fund  to  and  including  1917.  The  calcu- 
lations showed  that  if  the  city  were  to  contribute  to  the  fund  $558,000  per 
annum,  and  the  teachers  3  per  cent,  from  their  salaries  and  if  the  payment  of 
already  authorized  absence  refunds  and  those  to  be  authorised  in  the  future 
were  to  be  postponed  until  the  increased  income  of  the  fund  would  produce 
sufficient  balances  to  warrant  such  payments,  then  the  fund  could  continue 
its  operations  until  the  year  19 17.  On  the  basis  of  this  report,  which  was 
published  in  the  City  Record  in  the  issue  of  March  17,  1915,  a  bill  was  drawn 
for  introduction  at  the  close  of  the  191 5  session  of  the  legislature. 

In  the  meantime,  several  groups  of  teachers,  evidently  dissatisfied  with 
the  efforts  of  administrative  officials  to  save  the  fund  from  collapse,  inde- 
pendently prepared  a  number  of  pension  bills,  all  unsupported  by  adequate 
cost  calculations,  for  introduction  at  the  same  session  of  the  Legislature. 
The  Board  of  Estimate  bill  failed  of  passage,  as  did  all  the  pension  bills  in- 
troduced by  teachers'  organizations.  Even  the  bill  for  the  release  of  $300,000 
of  the  permanent  $800,000  reserve  fund  produced  dissension  among  the 
teachers  and  failed  to  become  a  law. 

The  failure  to  pass  the  relief  measure  advocated  by  the  Board  of  Esti- 
mate made  it  very  doubtful  whether  the  fund  would  be  able  to  pay  pensions 
already  granted  during  the  balance  of  the  year  191 5.    Only  by  careful  man- 

105 


agement  of  the  fund  could  the  Board  of  Education  be  enabled  to  pay  pensions 
during  the  balance  of  the  year.  In  the  months  of  February,  March  and 
April  the  Comptroller  advanced  to  the  fund  $225,000,  its  estimated  share  of 
the  excise  moneys,  which,  under  ordinary  circumstances,  would  have  been 
paid  in  January,  1916,  after  the  total  excise  tax  for  1915  had  been  collected. 
To  avoid  an  actual  deficit  payments  of  pensions  are  now  being  deferred  until 
amounts  are  accumulated  to  meet  each  monthly  disbursement. 

In  May,  191 5,  the  secretary  of  the  Pension  Commission,  at  a  conference 
held  with  the  Comptroller  and  members  of  the  Board  of  Education,  submit- 
ted a  report  containing  tentative  constructive  recommendations  for  the 
permanent  reorganization  of  the  fund  in  1916.  It  had  been  prepared  merely 
as  a  first  step  to  definitize  the  problem  to  be  solved  and  to  ofifer  possible  solu- 
tions. In  this  report,  special  attention  was  called  to  the  fact  that  deficiencies 
were  anticipated  in  the  fund  during  the  last  three  months  of  the  current  year 
and  that  if  no  further  payments  of  refunds  for  absence  deductions  were 
made  until  1916,  the  pensions  would  have  to  be  reduced  16  per  cent,  from 
July,  1915,  or  32  per  cent,  from  October,  1915. 

The  fund  is  now  living  f rorrt  hand  to  mouth ;  no  further  retirements  are 
possible ;  teachers  are  paying  one  per  cent,  of  their  salaries  to  meet  arrear- 
ages in  the  fund  and  with  no  assurance  that  when  their  time  comes  to  retire 
provision  will  be  made  for  them.  Reorganization  and  refinancing  of  the  fund 
is  imperative.  It  must  be  undertaken  in  full  view  of  the  facts  and  with  com- 
plete appreciation  that  a  great  retirement  system  cannot  be  maintained  with- 
out straightforward,  adequate  financing. 


106 


APPENDIX  TO   PARTS  I  AND  II 


Table  1 — employees  subject  to  retirement  law,  may  31,  1915  * 


Class  of  Employees 


Superintendents 

Board  of  Examiners 

Supervisors  and  Directors,  Asst.  Su- 
pervisors and  Directors,  Inspect- 
ors and  Asst.  Inspectors,  Special 
Teachers 

President  of  Hunter  College 

Principals  of  Training  Schools 

Principals  of  High  Schools 

Principals  of  Vocational  (Trade) 
Schools 

Principal  of  Parental  School 

Principals  of  Elementary  Schools 

Principal  in  Charities  Dept 

Assts.  to  Principals,  Elementary 
Schools 

Teachers  in  Hunter  College 

Teachers  in  Training  Schools 

Teachers  in  High  Schools 

Teachers  in  Vocational  (Trade) 
Schools 

Teachers  (Grade)  iq  Elementary 
Schools 

Kindergarten  Teachers,  Elementary 
Schools 

Teachers,  Dept.  of  Charities 

Teachers,  Dept.  of  Correction 

Totals 


Men 

Women 

Total 

33 

4 

2 

35 
4 

189 

1 

2 

23 

420 

"i 

609 

1 

3 

23 

2 

1 

229 

1 

244 

1 

3 

1 

473 

1 

12 

12 

23 

1,028 

453 

163 

89 

1,156 

465 

175 

112 

2,184 

20 

12 

32 

1,127 

15,137 

16,264 

'7 

920 
5 

920 
5 

7 

2,713 

18,604 

21,317 

Total 
Annual 
Salary 
Charges 


$192,250 
24,000 


931,255 
10,000 
15,000 

110,500 

12,250 

3,000 

1,527,960 

3,500 

1,115,250 
446,372 
279,030 

4,766,145 

59,675 

19,807,750 

967,140 
7,440 
5,700 


$30,284,217 


Average 
Annual 
Salary 
Charges 


$5,492.86 
6,000.00 


1,529.15 

10,000.00 

5,000.00 

4,804.35 

4,083.33 
3,000.00 
3,230.36 
3,500.00 

2,398.39 
2,550.70 
2,491.34 
2,182.30 

1,864.84 

1,217.89 

1,051.24 

1,448.00 

814.29 


$1,420.66 


Compiled  from  the  records  of  the  Auditor  of  the  Board  of  Education. 


109 


TABLE  2— MEN  TEACHERS— ACTIVE  FORCE  AS  OF  JUNE  30.  1914,  CLASSIFIED  BY 
AGE  AND  LENGTH  OF  SERVICE  * 


Present  Age 

Total 

Length  of  Service 

Less 

5  and 

10  and 

15  and 

20  and 

25  and 

30 

than  5 

less 

less 

less 

less 

less 

and 

years 

than  10 

than  15 

than  20 

than  25 

than  30 

over 

20  yrs.  and  less  than  25  yrs. 

165 

161 

4 

25     ' 

'    30     " 

542 

229 

290 

23 

30     ' 

'    35     " 

529 

80 

203 

239 

7 

35     ' 

'    40     " 

466 

73 

136 

129 

125 

3 

40     ' 

'    45     " 

360 

33 

91 

108 

97 

30 

i 

45     ' 

'    50     " 

232 

8 

41 

60 

75 

25 

22 

1 

50     ' 

'    55     " 

141 

6 

28 

50 

26 

24 

7 

55     ' 

'    60     " 

77 

2 

13 

17 

15 

16 

14 

fiO     * 

'    65     " 

68 

7 

21 

11 

13 

16 

65     ' 

'    70     " 

28 

1 

7 

2 

6 

12 

1 

:ot 

il  Nu 

mber 

2,608 

584 

773 

608 

399 

112 

82 

50 

Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,   1914. 


110 


TABLE  3— WOMEN  TEACHERS— ACTIVE  FORCE  AS  OF  JUNE  30,  1914,  CLASSIFIED  BY 
AGE  AND  LENGTH  OF  SERVICE  * 


Total 

Length  of  Service 

Present  Age 

Less 

5  and 

10  and 

15  and 

20  and 

25  and 

30 

than  5 

less 

less 

le^s 

less 

less 

and 

years 

than  10 

than  15 

than  20 

than  25 

than  30 

over 

17  yrs.  and  less  than  20  yrs. 

16 

16 

20     "      * 

'     25     " 

3,305 

3,217 

88 

25     "      ' 

'     30     " 

4,110 

1,408 

2,519 

183 

30     "      ' 

'     35     " 

3,145 

247 

1,022 

1,696 

179 

i 

35     "       ' 

'     40     " 

2,655 

178 

385 

671 

1,261 

160 

40     "       ' 

'     45     " 

1,999 

96 

249 

345 

453 

738 

lie 

2 

45     "       ' 

'     50     " 

1,299 

17 

66 

215 

185 

217 

495 

104 

50     "       ' 

'     55     " 

790 

4 

9 

81 

104 

74 

138 

380 

55     "       ' 

'     60     " 

414 

1 

1 

19 

37 

58 

34 

264 

60     "       ' 

'     65     " 

192 

12 

11 

11 

15 

143 

65     "       ' 

'     70     " 

51 

1 

4 

4 

4 

5 

33 

70     "      ' 

'    75     " 

4 

1 

3 

To 

tal 

Numh 

er 

17,980 

5,185 

4,339 

3,226 

2,234 

1,264 

803 

929 

*  Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,  1914. 


Ill 


t 

••• 

1« 


-wj    Q^ 


!i 


i 

1 

M 

a 

s 

i 

m 

.\     II 

•  rr.Tfba^ 


Table  5 — number  of  teachers  who  withdrew  from  the  active  service 

FOR  various  causes  DURING  THE  YEARS   I909  TO  I914  * 


Year 


Deaths 


Retire- 
ments 


Resigna- 
tions 


Dis- 
missals 


Total  With-  Strength 
drawals        of  Forcef 


1909 

1910 

1911 

1912 

1913 

1914 

Totals. 


71 

94 

480 

68 

125 

577 

71 

113 

492 

76 

134 

602 

54 

188 

607 

78 

151 

583 

418 


805 


3,341 


2 

647 

17,244 

3 

773 

17,907 

1 

677 

18,369 

812 

19,073 

4 

853 

19,681 

3 

815 

20,588* 

13 


4,577 


Table  6 — ^detailed  statement  of  disbursements  J — 1894  to   1914 


Year 


Pension 
Payments. 


Administrative 
Expense 


Total  Dis- 
bursements 


1894 

1895 $12,633.34 

1896 42,595.07 

1897 71,539.49 

1898 102,157.04 

1899 124,296 .  18 

1900 214,563 .  57 

1901 263,805.28 

1902 343,017 .  13 

1903 420,026.99 

1904 477,418.74 

1905 526,502.36 

1906 616,984 .54 

1907 689,390.64 

1908 724,129.78 

1909 777,800.85 

1910 833,863.59 

1911 880,389 .  83 

1912 983,554 .  99 

1913 1,108,874 .  30 

1914 1,183,397 .  08 

Totals $10,396,940.79 


$12,633.34 
42,595.07 
71,539.49 

102,157.04 

124,296.18 

214,563.57 
263,805.28 
343,017.13 
420,026.99 

477,418.74 
526,502.36 
616,984.54 
689,390.64 
724,129.78 

$141.00 
619.90 

777,941.85 
834,483.49 

682.15 

417.20 

1,929.0011 

881,071.98 

983,972.19 

1,110,803.30 

811.04 

1,184,208.12 

$4,600.29   $10,401,541.08 


*  Compiled  by  mechanical  tabulation  of  census  cards  taken  on  Jtine  30,  1914.  The  data  is 
given  for  the  years  indicated  ending  June  30th. 

tAs  stated  in  the  annual  report  of  the  Teachers'  Retirement  Fund  for  1913,  figures  for 
July  31st  of  the  years  indicated.  The  strength  of  the  force  in  1914  is  given  as  of  June  30th,  accord- 
ing to  the  results  of  the  census  of  the  municipal  service. 

J  As  shown  for  the  years  1894  to  1913  in  the  annual  reports  of  the  Teachers'  Retirement 
Fund,  and  for  the  year  1914  on  the  books  of  the  Auditor,  Board  of  Education. 

i  Net  amount  to  annuitants. 

I  Partly  chargeable  to  1912. 


113 


Table  7 — ^detailed  statement  of  receipts  * — 1894  to   1914 


Year 

Employees' 
Contribu- 
tions 

Absence 

Deductions 

(Net) 

Fines 

Excise 
Licenses 

Interest 

Donations 

Total 
Receipts 

1894 

$25,060.33 
62,897.08 
50,504.04 
63,382.58 
59,213.83 

77,779.14 

87,327.01 

185,799.64 

146,703.70 

160,535.67 

193,062.99 
186,727.32 
211,976.05 
274,743.13 
227,534.25 

261.646.23 
254,618.49 
255,464.17 
254,384.02 
240,123.92 

464,419.57 

'$548!6i 
V,269;97 

$25,060.33 
62.897.08 
50  504  04 

1895 

1896 

1897 

$41,283.99 
23,858.34 

30,479.86 

43,079.45 

19,741.98 

418.14 

$2,961.81 
728.20 

4,225.28 
10,772.76 
13,698.70 
16,579.30 
41,306.77 

40,975.63 
35,708.15 
39.766.84 
43.155.13 
48.536.62 

52,025.16 
50,328.61 
41,308.67 
49,234.85 
36,902.17 

45.881.20 

"$i5;66 
"soo^oo 

"sss^oi 

"44i;87 

107.628  38 

1898 

83,800  37 

1899 

1900 

1901 

1902 

1903 

$269,094.83 
266,859.37 
265,853.17 
262,066.04 
265,917.78 

281,964.66 
281,973.60 
285,275.54 
287,853.89 
294,694.22 

386,054.58 
272,772.03 
291,803.16 
286,579.67 
t484,212.31 

281,584.35 

381,579.11 
408,038.59 
485,108.49 
425,767.18 
468,060.22 

516,003.28 
597,048.00 
706.072.85 
784.354.89 
760.176.05 

898.208.84 
786.340.54 
803,734.45 
849,198.48 
1.031.422.84 

1,077,142.64 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 

1913 

1914 

92,638.93 
169,054.42 
178,214.73 
189,410.96 

198,482.87 
207,630.93 
215,158.45 
257,729.97 
270,184.44 

285,257.52 

Totals. . . 

$2,222,624.98 

$3,743,903.16 

$1,818.58 

$4,764,559.20 

$574,095.85 

$1,144.88 

811,308,146.65 

*  As  shown  for  the  years  1894  to  1913  in  the  annual  report  of  the  Teachers'  Retirement  Fund, 
and  for  the  year  19 14  on  the  books  of  the  Auditor,  Board  of  Education. 

t  Includes  $200,000  of  the  fund's  share  of  excise  taxes  for  the  year  1913  which,  if  custom 
of  previous  years  were  to  be  followed-  would  have  been  turned  over  to  the  fund  in   1914. 


114 


Table  8 — absence  deductions,   refunds   and   net   deductions  * — 1894 

TO   I914 


Year 


Gross 

Absence 

Deductions 


Refunds  of  Absence 
Deductions 


Amount 


Per  Cent 
Refunded 


Net 

Absence 

Deductions 


1894 $28,158.81 

1895 66,688.84 

1896 60,846.13 

1897 70,844.30 

1898 86,627.45 

1899 110,554.25 

1900 149,779.11 

1901 298,607.08 

1902 267,177.37 

1903 280,029.59 

1904 297,013.68 

1905 324,483.90 

1906 357,752.52 

1907 405,106.75 

1908 379,493.44 

1909 440,610.37 

1910 528,053.68 

1911 555,992.42 

1912 575,850.37 

1913 594,927.94 

1914 481,646.44 

Totals $6,360,244.44 


$3,098.48 
3,791.76 

10,342.09 
7,461.72 

27,413.62 

32,775.11 

62,452.10 

112,807.44 

120,473.67 

119,493.92 

103,950.69 
137,756.58 
145,776.47 
130,363.62 
151,959.19 

178,964.14 
273,435.19 
300,528.25 
321,466.35 
354,804.02 


11.0 
5.7 
17.0 
10.5 
31.6 

29.6 
43.0 
37.8 
45.0 
43.0 

35.0 
42.5 
40.7 
32.2 
40.0 

40.6 
51.8 
54.1 
55.8 
59.6 


17,226.87  3.6 

2,616,341.28        41.1 


$25,060.33 
62,897.08 
50,504.04 
63,382.58 
59,213.83 

77,779.14 

87,327.01 

185,799.64 

146,703.70 

160,535.67 

193,062.99 
186,727.32 
211,976.05 
274,743.13 
227,534.25 

261,646.23 
254,618.49 
255,464.17 
254,384.02 
240,123.92 

464,419.57 

$3,743,903.16 


*  Compiled   from  annual  reports  of  the   Teachers'    Retirement   Fund    (for    1894   to    1913)    and 
from  statement  prepared  by  the  Auditor  of  the  Board  of  Education  (for  1914). 


115 


s 

*8oo§ 

S§8fe§ 

s 

Oi-IINCO 

lit 

1 

i» 

00  00  00  00  00 

OOOJOSffiOS 

OS  OS  O  OS  OS 

fj> 

i-l  rH  .H  tH  r-t 

rtrtrtrtrt 

^ 

o 

.    ^ 

t»  00  00  tow 

(N  00  00  OS  "5 

•HNNMOS 

CO 

00 

5>  P>"«-s 

N  (N  m;  d  OJ 

C0>OiO00  00 

lOrtCOXlN 
OS  00  00  00  OS 

tO>-ltO00tO 

totomuii^ 

OOOOrtO 

OS 

s 

OS 

OS 

3 
J3 

^ 

■s;fe2s; 

00 1»  00  coos 

^^^■$^ 

■COSOOOSO 

(N 

s 

-S 

i-iiON^ro 

00-*OS^C0 

3s 

0  a> 

1 

■ntrsat^ 

«Oe«5"5t^® 

s 

^ 

>M 

i5 

0>CDO-H(N 

^OOOOSIN 

■*oo«-t^o 

s 

o 

NiOOOOO 

Tj<ioosco^ 

OS-^OOSOO 

(N 

§ 

•E22ra 

■<»<Titmroo 

t^tOtOOSTti 

t»-*rMC0O 

,_t 

1 

rH-^t^O 

(N^^'^M 

WNtHOOM 

t-CO00«rt 

iri 

o 

§ 

i-hNMMtJI 

•*U3tDtOt» 

t-OOOOOSrH 

d 

I/} 

g 
§ 

«A 

V 

a 

■i§:^ 

oomoo 

OOStHCMO 

s 

^ 

Q 

1^1 

tHOS<N(^OS 
•.»<t-iOO»HN 
•HtOtO-OlOS 

s 

8 

to 

Ol 

w 

u 
ttf 
J* 

OOt*  00  CO  Oi 

■«Jt  to  •*  Tjl  00 

t-coiotot^ 

§ 

OS 

* 

(U 

i-HUSMrt® 

00  lO  00  OS  CO 

l> 

ii 

gc 

•PSiOOSt^ 

tocoioi>o 

00(N-*OOS 

pcoos-^-* 

o 

>t 

Tf 

^ 

.2  S 

03«>O.-H(N 

.-lOoOOSIN 

-* 

•*-> 

S6 

^(2 

•  tOiOU5.-l 

INiOOOOO 

T*H  in  OS  CO -H 

00  00  CO  lO  00 

CO 

0^ 

•o 

.C<f(N.-l(N 

TjlTjICOMO 

r-totoosTjt 

t^coocooo 

CO 

to 

"O 

(Nt-(:D-*N 

t^e<i.-iooiN 

OS 

V 

c 

rH(NMCOT)l 

^UStOCOt^ 

l^00  00OS.-( 

CO 

.2 

a 

a> 

f^ 

,^ 

o 

o 

** 

•a 

1 

a 

t 

i3"S 

^c5 

88888 

88888 

88888 

88888 

8 

8 

l3 

t-i 

O 

o 

l-H  f-H  »-t  *-t  1-t 

1-C-H.-l,-lrt 

c 

3 

b< 

■M 

V 

«OOC0C0 

;2§52?3 

OOOlCOSiCl 
(NOOOOOO 

00  in  •<ji  T)H  00 

s 

in 
to 

H 

-" 

Ot^^OOp 
tOOJOINO 
OOOUiOOO 

OJOOOOt^O 

CO  00  IN-*  to 

oOOeO'H 

OOOTflOOIN 

IN 

to 

o 

3 

•a 

O 

rt.g. 

t~COO«5tO 

0-»t<COOS(N 
MCOt^-^'* 

•f 

-* 

s 

^1 

NtoSow 

rtOOUSUSOO 
00O00(N!O 

tOWtO'JiO 

00  to  CO  OSf— * 
OsooO-*co 
«t»ooooo 

w 

s 

.^ 

p^ 

CO  •*•*■*  tjl 

u5iot^t»r» 

o 

CO 

S 

TS 

-< 

1-1 

^ 

04 

•o 

b] 

*» 

"to 

V 

t/> 

o 

Pi 

,   +> 

OUS-'ifOCO 

tHOS'^-hos 

©©■^ooo 

to 

00 

;3 

<u 

^6 

•     •     -t^OO 

rtOOOOJOO 

OS  OS  to  "5  CO 

00  •'(I  .-1  00  lO 

IN 

o 

F 

(N 

^(NINCOOO 

r-ujujicto 

"5  to  in  "5  CO 

TX 

<o 

s 

J3 

o 

1> 

.     .     .rtO 

OOtOOOt^ 

CO  "5'*  CON 

to»-<t^>ot^ 

o 

in 

U-t 

c 

^ 

00  c^ 

(Nt^t^COt^ 

tOrlOOr-ltO 

.-HtOtOOO^ 

00 

V, 

D 

1— 1 

2 

.-100 

1ON00O5  5O 

"5  00  to  lO  to 
l>.OtOiOCO 

moOOOrt<C^ 

^ 

in 

J3 

B 

^ 

(NINOCOO 

00 

8 

2; 

o 

c 

(Mt-tqioco 
•*dco«d^ 

03t>._t^t-HIO 

dicoscood 

O  CO  COIN  OS 
Ndrt'os'to" 

00 

in 

*♦•» 

o 

u 

M 

t<» 

•*  eo  CO  ■^  •<j< 

US  U5  •*■<*<  CO 

■* 

b- 

t/3 

«« 

o 

o 

H 

&4 

l-> 

fee 

:  :  :  :8 

:  :  :§  : 

:g  :  :  : 

o 

V 

Ui 

o 

U 

o 

u 

U 

(/} 

») 

• 

a 

o 

F 

bJ 

>% 

H 

.2  to   . 

:  :8  :8 

!  :  :©  • 

t^   .   .   . 

X     •     •     • 

SB 

3 

c 
c 

CO 

u 

o_ 

>> 

Rl 

^ 

U3 

M 

•      -US      -g 

:  :  :gg  : 

•   •   -co   • 

■*   ;   i   1 
1*   .   .   . 

-* 
•«1< 

o 
««•  ja 

(U 

QM 

^ 

■•■^ 

N 

P^ 

a 

o 

V 

osoOrtO^ 

tpOININO 

.-irji»mco 

.-li-lO00(N 

to 

to 

M 

rt 

fee 

00  to 

IN 

IN 

*^ 

<; 

C 

^d 

8882§g 

OtOCOO—c 

(N00O.-I00 

Nt^OOCOO 

OS 

in 

w 

-« 

H 

< 

03  00  OS  OS  OS 

ost^r^wto 

t-.  to  to  to  t- 

to 

t^ 

0\ 

•s 

.2 

•1- 

•M- 

15     ' 

S?§S§S 

t»00.-l-*iO 

lONOSINt^ 

i-HCOCOCOCO 

IN 

31 

V 

03  CO  00 1^'* 

t0  03U50r1( 

WrlCOtOIN 

OS 

*" 

J3 

M 

•^     o 

iS;S§32 

t»Oi-Ht^00 
0»0>0  03(N 

OOSt^COtO 

ocotococo 

d 

•4- 

t^00"5<O«5 

o 

000>«COIN 

oOi-itDr^-* 

Ot^(NiO(N 

o 

00 

1-i 

lONOCOOl 

CO  T»(  1-1  CO  to 

"SOOt^MN 

t^t^t^iM-* 

to 

o 

3 
T3 

(NtOiOtOUS 

t^  to  OS  to  (N 

SoSSt^ 

■* 

V 

CO  CO  ■*  Tjl  •<»< 

Tjt  Tji  ■<)(  in  »o 

^. 

2 

3 

u 

00 

CD 

u 
cd 

•     •     .lOI^ 

osifscpo    • 

•  .-1  •<*l  CI  r^ 

mot^icos 
O'.jtt^co.-i 

00 

in 

s 

iBa 

•COtJI 

most- OS 

-* 

>> 

^6 

•00  00 

r^OTji 

mcoiN-* 

(NtOtOOtO 

to 

OS 

m 

en 

•     •     -COIN 

•»He»(MN 

ININNCOiN 

IN 

l-l     . 

.d 

JB 

•  s 

•     •     -Oi-^ 

tOlOOOTll     • 

•CO  <N  CO  to 

t^COU5t»'«Jl 

IN 

00 

««  5 

_a 

|-|"ss 

»co 

oo'<i<a>.H   • 

OS-*t^OS 

00  OS -^It  OS-* 

m 

'1 

s^s 

oo-^-^o 

NOOOOS-* 

oocomiNoo 

1^ 

•* 

n) 

V 

in 

NOO 

•<1HOt»Tlt       ■ 

tOON-* 

•0<tOrHl^-H 

CM 

•c  7^ 

CD 

e9 

rtco 

dcoos       : 

Nosodos 

O0t>-i0t--0 

m 

IN 

CO   W 

« 

r. 

wo 

'     '       M'N 

CO-«"^ 

OS  to  t»  00 

oso»-<>ot~ 

00 

5  >« 
<   o 

•» 

.-Hrtrt 

^INNNIN 

IN 

IN 

a 
l-l 

*» 

*     13 

•H- 

■f+ 

>H 

■«fliO®t^00 

gssss 

sssss 

©O-HC>»C0 

-* 

■B 

l-l 
eg 
o 

K 

X 

00  00 

00  OS  OS  OS  OS 

c- 

OS  OS  OS  OS 

s 

w  OSOS  O 

^ 

pq 

116 


Table  io — statement  of  surpluses,  deficits  and  balances  * — 

1894  to  1914 


Year 

Receipts 

Disbursements 

Surplus 

DeBcit 

Balance 
Dec.  31st 

1894 

$25,060.33 

62,897.08 

50,504.04 

107,628.38 

83,800.37 

381,579.11 

408,038.59 

485,108.49 

425,767.18 

468,060.22 

516,003.28 

597,048.00 

706,072.85 

784,354.89 

760,176.05 

898,208.84 

786,340.54 

803,734.45 

849,198.48 

1,031,422. 84t 

1,077,142.64 

$25,060.33 

50,263.74 

7,908.97 

36,088.89 

257,282 193 

193,475.02 

221,303.21 

82,750.05 

48,033.23 

38,584.54 

70,545.64 

89,088.31 

94,964.25 

36,046.27 

120,266.99 

$25,060.33 
75,324.07 
83,233.04 

1895 

$12,633.34 
42,595.07 
71,539.49 
102,157.04 
124,296.18 
214,563.57 
263,805.28 
343,017.13 
420,026.99 
477,418.74 
526,502.36 
616,984.54 
689,390.64 
724,129.78 
777,941.85 
834,483.49 
881,071.98 
983,972.19 
1,110,803.30 
1,184,208.12 

1896 

1897 

119,321.93 

1898 
1899 

$18,356.67 

100,965.26 
358,248.19 
551,723.21 

1900 

1901 

773,026.42 
855,776.47 

1902 

1903 

903,809.70 
942,394.24 

1904 

1905 

1,012,939.88 
1,102,028.19 

1906 

1907 

1,196,992.44 
1,233,038.71 
1,353,305.70 
1,305,162.75 
1,227,825.22 
1,093,051.51 
1,013,671.05 
906,605.57 

1908 

1909 

1910 
1911 
1912 
1913 
1914 

48,142.95 
77,337.53 

134,773.71 
79,380.46 

107,065. 48t 

Total. 

$11,308,146.65 

$10,401,541.08 

$1,371,662.37 

$665,056.80 

*  Compiled  from  annual  reports  of  Teachers'  Retirement  Fund  (1894  to  1913)  and  from 
statement  of  Auditor  of  Board  of  Education  for   1914. 

t  Includes  $200,000  advanced  for  excise  taxes  in  this  year. 

t  The  deficit  would  have  been  much  larger  if  the  payment  of  refunds  of  absence  deductions 
had  not  been  postponed. 


117 


Table  ii — receipts  and  disbursements 


Available 
Balance  at 
Beginning 
of  Period 

Receipts 

Month 

Employees' 
Contributions 

Gross 
Absence 
Deductions 

Excise 
Licenses 

Interest 

Dona- 
tions 

Unclaimed 
Annuities 

Total 
Receipts 

Receipts  and 
Balances 

1915 

January 

February 

March 

April 

May 

June 

July 

129,841.09 

5,315.82 

47,190.10 

9,164.54 

81,130.56 

154,780.62 

59.799.12 

58,010.20 

-39,819.80 

—  96,180.62 

-154,716.37 

-180.751.99 

$1,402.53 
24,097.52 
24,577.07 
25,044.91 
48,484.93 
24,815.71 
49,827.33 

24,666.87 
24,211.91 
24,243.81 
24.864.57 

$45.66 
27.427.11 
60,815.73 
51,809.69 
112,398.15 
56,895.04 
47.067.35 

17.652;  si 
14,582.34 
39,994.84 
39,014.16 

$76,169.07 

100,000.00 

25,000.00 

100,000.00 

$195.98 

170.22 

63.90 

145.53 

6,710.42 

10,967.80 

264.57 



$i2;66 

$7,920  !7i 
6.343!  05 

EST 

ACTUAL  REC 

$77,813.24 
159,615.56 
110,468.70 
177,000.13 
173,936.55 
92,678.55 
97,159.25 

IMATED  REC 

EIPTS  AND 

$107,654.33 
164,931.38 
157,658.80 
186,164.67 
255,067.11 
247,459.17 
156,958.37 

August 

September. . . 

October 

November. . . 
December 

EIPTS  AND 
58,010.20 

41,719.18 
38,794.25 
71,044.38 
74.555.51 

1,899.38 

6,805'.  73 
10,676.78 

-57,386.37 

-83,671.99 

-  106,196.48 

Total . .  . 

$295,637.16 

$467,702.38 

$301,169.07 

$36,000.93 

$12.00 

$14,263.76 

$1,114,785.30 

Deficit,  December  31,  1915 

Deduct  accrued  receipts: 

1%  salary  contributions.  December.  1915 $24,673.12 

Absence  deductions.  December,  1915 51,805.68 

Total  accrued  receipts 

Deficit  (after  deducting  accrued  receipts) 


-$203,026.48 


$76,478.80 
-$126,547.68 


*  Compiled  from  the  books  of  the  Finance  Department  for  the  months  January  to  July;  the 
figures  for  the  remaining  months  estimated  on  the  basis  of  probable  future  cash  receipts  under  the 
assumption  that  no  payments  of  refunds  will  be  made  during  the  balance  of  the  year. 


118 


DURING   THE    YEAR    I915 


Disbursements 

Available 

Pensions 

Admini- 
strative 
Expense 

Refuntis  of 

Absence 
Deductions 

Refunds  of 

Salary 
Deductions 

Refunds  of 
Unclaimed 
Annuities 

Total 
Disbursements 

Balance  at 
End  of 
Period 

EISBURSEM 

$101,220.92 
100,937.31 
100,701 .  16 
100,611.16 
98,844.70 
98,521.81 
98,055.29 

DISBURSEM 

97,805.00 

ENTS 

$25.00 
25.00 
25.00 
25.00 
25.00 
25.00 
25.00 

ENTS 

25.00 
525.00 
25.00 
25.00 
25.00 

$967.59 

16,715.04 

47,727.06 

4,397.95 

1,327.67 

88,851.80 

671.62 

"$i!43 
41.04 

■29;i2 
151.44 

$125.00 
62.50 

'eoloo 

110.00 
196.26 

$102,338.51 
117,741.28 
148,494.26 
105.034.11 
100.286.49 
187.660.05 
98.948.17 

97.830.00 
98,080.00 
97,330.00 
97,080.00 
96,830.00 

$5,315.82 
47,190.10 
9,164.54 
81,130.56 
154,780.62 
59,799.12 
58,010.20 

-39,819.80 
—  96  180  62 

97.555.00 

97,305 .  00 

-154,716.37 
-180,751.99 
-203,026.48 

97,055.00 

96,805.00 

$1,185,417.35 

$800.00 

$160,658.73 

$223.03 

$553.76 

$1,347,652.87 

Totals 

Deficit  (after  deducting  accrued  receipts) —  $126.547 .  68 

Add  accrued  liabilities: 

Estimated    balance    of    refunds   of  absence   deductions    (September  25,   1913  to 

December  31.  1915) 187,348 .68 

Corrected  deficit $313,896.36 

Permanent  fimd 800,000.00 

Total  balance  in  fund $486,103.64 


119 


Table  12 — comparative  growth  of  active  force  and  pensioners-  and 
of  salary  and  pension  rolls 1905  to  i914 


Total  Pensioners 

Pensions  Paid 

Strength 

Payroll  of 

Year 

of 

Active 

Force  * 

Per  Cent 

Force  f 

Per  Cent 

Number  * 

of  Active 
Force 

Amount 

of  Active 
Payroll 

1905 

13,888 

698 

5.03 

II 

$526,502.36 

1906 

14,660 

805 

5.49 

$16,905,442.00 

616,984.54 

3.65 

1907 

15,728 

909 

5.78 

17,821,473.00 

689,390.64 

3.87 

1908 

16,655 

950 

5.70 

18,941,096.00 

724,129.78 

3.82 

1909 

17,244 

1,008 

5.85 

19,848,287.00 

777,800.85 

3.92 

1910 

17,907 

1,089 

6.08 

20,763,093.00 

833,863.59 

4.02 

1911 

18,369 

1,173 

6.39 

21,515,845.00 

880,389.83 

4.09 

1912 

19,073 

1,259 

6.60 

25,772,997.00 

983,554.99 

3.82  t 

1913 

19,681 

1,515  § 

7.70 

27,018,444.00 

1,108,874.30 

4.10 

1914 

20,588  ** 

1,549  § 

7.59 

28,525,752.00 

1,183,397.08 

4.15 

Per  cent 

• 

increase 
1914  over 

>    48.24 

121.92 



68.74  H 

124.77 



1905 

*  As  stated  in  the  annual  report  of  the  Teachers'  Retirement  Fund  for  1913,  figures  for 
July  31st  of  the  years  indicated. 

**  Number  of  participating  employees  June  30,  19 14,  as  shown  by  census  of  municipal 
service. 

t  Estimated  on  the  basis  of  the  i  per  cent,  deductions  from  salaries  during  the  calendar 
years  indicated. 

t  The  decrease  is  explained  by  the  extraordinary  increase  in  the  payroll  for  1912,  due  to  a 
general  raise  in  salary  scales. 

S  As  of  December  31st. 

II  Deductions  from  salaries  were  made  only  for  part  of  this  year. 

I  Increase  of  1914  over  1906. 


120 


Table  13 — pensioners  on  pension  roll  December  31,  1913,  and  December 

31,    I914,  CLASSIFIED  according  TO  AMOUNTS  OF  ANNUAL  PENSION 


Annual  Amount 

Pensioners 

on  Roll 

Dec.  31,   1913 

Per  Cent. 
Of  Total 

Pensioners 

on  Roll 

Dec.  31,  1914 

Per  Cent, 
of  Total 

$400  and  less  than   $450 

20 

1.3 

21 

1.3 

450     "       " 

'       500.... 

27 

1.8 

27 

1.7 

500     "       " 

•       550.... 

56 

3.7 

59 

3.8 

550     "       " 

'       600.... 

44 

2.9 

43 

2.8 

600     "       " 

'       700.... 

626 

41.3 

618 

39.9 

700     "       " 

•       800.... 

308 

20.3 

322 

20.8 

800      "       " 

•       900.... 

79 

5.2 

80 

6.1 

900     "       " 

*     1,000.... 

134 

8.8 

145 

9.4 

1,000     "       " 

'     1,250.... 

89 

5.9 

98 

6.3 

1,250     "       " 

'    1,500.... 

79 

5.2 

83 

5.4 

1,500     "       " 

•    1,750.... 

44 

2.9 

45 

2.9 

1,750     "       " 

'    2,000.... 

. . . 

2,000     "       " 

'    2,500.... 

7 

6.5 

6 

6.4 

2,500      '•       " 

'    3,000.... 

.  .   . 

3,000     "       " 

'    3,500.... 

1 

o.i 

1 

6.i 

3,500     "       " 

'    4,000.... 

4,000     "       " 

'    4,500.... 

. . . 

4,500     "       " 

'    5,000.... 

. . . 

5,000     "       " 

'    6,000.... 

i 

o.i 

1 

O.i 

Total 

1,515 
779.85 

100. 

1,549 
784.53 

100. 

Average  Pension 
Annual  Charge. . 

$1,181,471.67 

$1,215,231.11 

Table  14 — men  teachers — total  number  of  persons  on  the  pension 

rolls  on  june  3o,  i914 

classified   by   present   AGE   AND   CAUSE   OF   RETIREMENT* 


Number 

Total  Dis- 

Present Age 

Total 

of  Service 
Pensioners 

ability 
Pensioners 

45    years  and  less  than  50 

years 

3 

3 

50      " 

'        "    55 

3 

2 

55       " 

'       "    60 

II 

6 

2 

60       " 

'       '•    65 

<i 

13 

12 

65       " 

'       "    70 

<< 

12 

11 

70       " 

'       "    75 

i< 

18 

17 

75       " 

i 

•       "    80 

II 

15 

15 

80       " 

II 

"       "    85 

11 

11 

11 

85       "        '•       "       "    90 

II 

, , 

90  years  and  over 

i 

i 

Total 

82 

71 

11 

Average  prese 

nt  age 

69.50 

71.44 

57.00 

Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,  1914. 

121 


Table  15 — women  teachers — total  number  of  persons  on  the  pension 

rolls  on  june  3o,  i914 

classified  by  present  age  and  cause  of  retirement  * 


Present  Age 

Total 

Number  of 

Service 
Pensioners 

Number  of 
Disability 
Pensioners 

35  ye 
40     ' 

ars  anc 

le 

ss  tha 

a  40  years 

45     "     

3 
37 

""2 

87 

228 

279 

269 

186 

84 

22 

2 

2 

3 
37 

45     ' 

50     "     

78 

76 

50     ' 

55     "     

168 

81 

55     ' 

60     "     

269 

41 

60     ' 

65     "     

299 

20 

65     ' 

70     "     

281 

12 

70     ' 

75     "     

191 

5 

75     ' 

80     "     

87 

3 

80     ' 

85     "     

22 

85     ' 

90     "     

2 

90     ' 

over. . . 

age 

2 

... 

Total.. 

. . . .      1,439 
. . . .     62.05 

1,161 

278 

/ 

Average  pi 

resent 

64.50 

51.83 

Table  i6 — men  teachers — number  of  pensioners  on  the  rolls  on  june 
30,  1914,  who  were  retired  for  length  of  service,  classified  by 
age  at  date  of  retirement  and  length  of  service  prior  to  retire- 
MENT * 


Years  of  Service 
Prior  to  Retirementf 


Number 


Average 

Age  at 

Appointment 


Average 

Age  at 

Retirement 


10  yeaas  and  less  than  15  years 3t                         57.00  70.33 

15     "       "      "       "     20     "     lot                         48.30  64.90 

20     "       "      "       "     25     "     8t                         40.00  62.88 

25     "       "      "       "     30     "     5t                         37.60  64.60 

30     "       "    over 45                          26.40  68.09 

Total 71                           33.10  66.90 

Average  service 33.80  years 

*  Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,   1914. 

t  Includes  only  service  in   New  York  City  schools.     Twenty-six  teachers  were  credited  with 
"outside"  experience  to  make  them  eligible  for  retirement. 


122 


Table  17 — women  teachers — number  of  pensioners  on  the  rolls  on 

JUNE  30,  I914,  WHO  were  retired  FOR  LENGTH  OF  SERVICE,  CLASSIFIED 
BY  AGE  AT  DATE  OF  RETIREMENT  AND  LENGTH  OF  SERVICE  PRIOR  TO 
RETIREMENT  * 


Years  of  Service 
Prior  to  Retirementf 


Number 


Average 

Age  at 

Appointment 


Average 

Age  at 

Retirement 


5  years  and  less  than  10  years. 


10 
15 
20 
25 
30 


15 
20 
25 
30 


2t 

8t 

26t 

27t 

40t 


over 1,058 


Total 1,161 

Average  service 


53.00 
45.88 
39.85 
37.29 
30.85 
19.73 


21.21 


61.50 
59.12 
56.58 
59.59 
58.45 
57.13 


57.25 


36.04  years 


Table   18 — men  teachers — number  of  pensioners  on  the  rolls  on 

JUNE    30,     I9I4,    who    were    RETIRED    FOR    DISABILITY,    CLASSIFIED    BY 
AGE  AT  DATE  OF  RETIREMENT  AND  LENGTH  OF  SERVICE  * 


Years  of  Service 
Prior  to  Retirement  t 


Ntimber 


Average 

Age  at 

Appointment 


Average 

Age  at 

Retirement 


5  years  and  less  than  10  years. 


10 
15 
20 
25 
30 


Total 

Average  service . 


15 
20 
25 
30 


It 
5t 
4 
1 


11 


53.00 
35.20 
36.00 
26.00 


36.27 


66.00 
51.40 
57.00 
52.00 


54.82 


18.55  years 


*  Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,   1914. 

t  Includes  only  service  in  New  York  City  schools.  One  hundred  and  three  teachers  were 
credited  with  "outside"  experience  to  make  them  eligible  for  retirement. 

t  Includes  only  service  in  New  York  City  schools.  Six  teachers  were  credited  with  "outside" 
experience  to  make  them  eligible  for  retirement. 


123 


Table  19 — women  teachers — number  of  pensioners  on  the  rolls  on 

JUNE    30,     191-^,    who    were    retired    FOR    DISABILITY,     CLASSIFIED    BY 
AGE  AT  DATE  OF  RETIREMENT  AND  LENGTH  OF  SERVICE  * 


Years  of  Service 
Prior  to  Retirementt 


Number 


Average 

Age  at 

Appointment 


Average 

Age  at 

Retirement 


0  years  and  less  than    5  years. 


5  " 

•  10 

10  " 

'  15 

15  " 

•  20 

20  " 

'  25 

25  " 

'  30 

30  " 

"  over. . 

It 

4t 

lot 

30t 
101 
95 
37 


Total 278 

Average  service 


47.00 
44.00 
41.90 
34.73 
22.90 
21.33 
20.22 


24.36 


51.00 
51.00 
64.73 
51.00 
44.90 
48.06 
54.03 


48.39 


24.03  years 


*  Compiled  by  mechanical  tabulation  of  census  cards  taken  on  June  30,  1914. 
t  Includes  only  service  in  New   York  City  schools.     Forty-five  teachers   were   credited  with 
"outside"  experience  to  make  them  eligible  for  retirement. 


124 


h 

55 

o 

< 

trt 

fa 

fH 

>< 

< 

piS 

< 

o 

o 
I? 
fa 

55 
< 

l-J 

« 

H 

fa 

rn 

a 

trt 

H 

W 

hJ 

O 

P4 

H 

< 

g 

H 

fa 

3 

> 

CQ 

fa 

< 

u; 

to 

Q 

fa 
O 

fa 
O 

^ 

» 

H 

< 

,.—^ 

!? 
& 

fa 

fa 
> 

o 

en 

u 

fa 

P 

u 

fa 

^J 

< 

o 

u 

1^ 

"A 

!?; 

o 

pj 

a 

o 

Tf 

< 

^ 

o\ 

^ 

fa 

o 

Xfl 

fa 
H 
fa 

8s 

1^ 

fa 

h-l 

u 

Q 

pe; 

< 

S 

U 

o; 

to 

H 

fa 

15 

o 

fa 

H 

fa 

i!5 

fa 

Ul 

i-t 

s 

s 

u 

fa 

H 

<: 

fa 

H 

l> 

w 

l-H 
> 

fa 

fa 

> 

fa 

l-H 

H 

^ 

fa 

o 

<5 

fa 

Q 

S 

;z; 

O 

< 

u 

1 

fa 
u 

o 

i-i 

c< 

> 

fa 

M 

fa 

J 

UJ 

PQ 

< 

H 

H 

sz: 

D 
O 

o 
o 

O  H 

5  w 

u  ^ 

^  w 

■< 

D  b 
Z  O 


Q 
fa 
H 

■«: 

OS 

O 

z 
o 

z 
u 

H 
O 
•< 
Bi 
fa 
> 
< 


o 
H 


O  CJ 


I.  c  "  > 


O        iJ 


SS  O   (U 


tn 

pii  •«! 
W  W  „ 

rp^  O 

S  iz:  w 

S  ca 

W  tft  o 
^  W 


A^  o 


OCMOOi-iOcOWXNOSiC 

O(N-*03C0O0500OO 

c<jiv-i(M<cecooooo 

l^OO»OlCC505COC5CTit> 


ooo 


OOOOOOP^OO 
OOOOOOOO 


OiOO 
00  CO-* 
eC(N<N 

oo"c<f 


(N  <£>■*■*  (N  »H  lO 
»0  00  O  TjH  CO  ^H  lO 


00<rib-O5I>C<IO51:^O500 

i-HTttooeooocoi-Hoooo-^ 
oot>.t^t>.t>.t^t^ooooos 


OC0N-«4iTHcDt>.00Ot^ 

Oi-H;Dt^i>eccoo-«i<-* 
o«o-«*->*tjhoo6ct>ooo 

t^iOiOiC«C»O»OcDl>00 


T-l00W5O5(NO5»OeCt^O5 
C<>(NOOOSTfHt~OCOiON 

oooooot^-oor-ooooso 


00t^«O00t^O5O5(NeO(N 
COOiOOa>(NOOO(Nt^O> 

1—1  I-t   1— I  C^   T— I 


c<5coc^(Niceo(NeoTt< 


s 


rH'<ittN.e0«Ol>.i-ICO(NO5 
5OC<ICv|C»C<ICQ>O»OC0 


<l>         o         " 


«5cot>.ooa>o»-iesicoT}< 

QOOOO'-Hi— ii-Hi— i>-i 


125 


Table  21 — pensioners  on  rolls  September  i,  1915,  who  were  retired 
for  disability  after  less  than  30  years  of  service 


Total 
Annual 
charge 

Num- 
ber 

Retired  After  an  Active 
Service  of 

Present  Age, 
Sept.  1,  1915 

20 

and 
less 
than 

22 
Years 

22 

and 
less 
than 

24 
Years 

24 

and 

less 

than 

26 

Years 

26 

and 

less 

than 

28 

Years 

28 
and 
less 
than 

30 
Years 

35  and  less  than  40  yrs 

$1,120.50 
20,029.00 
47,293.63 
63,489.53 
30,449.18 
13,715.86 
15,017.21 

2 
33 
77 
94 
46 
21 
24 

2 

28 

31 

10 

2 

2 

4 

'3 
17 
17 
6 
5 
4 

"2 
17 
21 
12 
3 
6 

'9 

21 

12 

3 

4 

40     "      "        "    45     "  

45     "       "       "    60     "  

50     "      "        "    55     "  

65     "       "        "     60     " 

60     "      "        "    65     "   

65     "    over 

'3 

25 

14 

8 

6 

Total 

$191,114.91 

297 

79 

52 

61 

49 

56 

Table  22 — retirements  on  the  ground  of  disability  after  less  than 
30  years  of  service  and  cancellations  on  account  of  death  and 
voluntary  reassignment  to  duty 


Year 

Retired 

for 

Disability 

Died 

Reassigned 

to 

Active 

Duty 

Number 

on  Roll 

December 

31 

Married 

1905 

1 
64 
27 
23 
26 
27 
31 
56 
52 
39 

1 
2 
2 
4 
5 
6 
4 
6 
6 
4 
3 

'2 

'2 
2 

62 
87 
106 
127 
146 
173 
221 
265 
300 
297t 

1906 

7 

1907 

3 

1908 

1 

1909 

1910 

4 

1911 

1 

1912 

5 

1913 

6 

1914 

5 

To|Sept. 

1,  1915 

Total 

346 

43 

6 

32* 

*  One  married  teacher  has  died  since  retirement. 
t  As  of  September  i,  191 5. 


126 


Table  23 — comparative  statement  of  pensioners  and  total  pension 
charge  for  the  years  i9i3  and  i914 


Pension  Fund 


December  31, 
1913 


December  31, 
1914 


Increase 


Decrease 


Police  Department: 

Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Fire  Department: 

Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Dept  of  Street  Cleaning : 
Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Dept.  of  Education: 
Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Dept.  of  Health: 

Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

College  of  the  City  of  N.  Y, 
Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Supreme  Court,   1st  Dept, 
Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 

Supreme  Coturt,  2nd  Dept. 
Number  of  pensioners. . . 

Average  pension 

Total  annual  charge. . . 


"Grady  Law"  pensioners: 
Number  of  pensioners. . 

Average  pension 

Total  annual  charge. . 


4,201 

$583.28 
$2,450,365.51 


1,636 
$633.53 
1,036,456.40 


356 
$395.38 
$140,753.50 


1,515 

$779.85 
1,181,471.67 


76 
$793.81 
$60,330.00 


4 
$1,081.25 
$4,325.00 


$1,143.75 
$9,150.00 


63 
$839.64 

$52,897.48 


4,234 
$581.37 
$2,461,528.55 


1,686 
$632.23 
1,065,939.73 


484 
$351.69 
$170,216.50 


1,549 
$784.53 
1,215,231.11 


97 
$827.91 
$80,307.50 


$1,081.25 
$4,325.00 


11 
$1,136.36 
$12,500.00 


$900.00 
$900.00 


166 
$772.40 
$128,218.10 


33 
$11,163.04 

50 
$29,483.33 

128 
$29,463.00 


34 
$4.68 
$33,759.44 


21 

$34.10 
$19,977.50 


$3,350.00 


$900.00 
$900.00 


103 
$75,320.62 


$1.91 


1.30 


43.69 


7.39 


67.24 


Total,  all  funds 

Number  of  pensioners. . . 

Average  pension 

Total  annual  charge 


7,859 
$628.04 
$4,935,749.56 


8,232 
$624.29 
$5,139,166.49 


373 
$203,416.93 


$3.75 


127 


Table  24 — aggregate  and  detailed  annual  cost  of  pensions  to  persons 
now  on  the  pension  roll  of  the  teachers'  retirement  fund 


Disability  Pensions 

Service  Pensions 

Year 

after 

♦Date 

Men 

Women 

Men 

Women 

Total 

Valua- 

tion 

Hunter 

Hunter 

Hunter 

Hunter 

Regular 
Teachers 

College 
Teachers 

Regular 
Teachers 

College 
Teachers 

Regular 
Teachers 

CoUege 
Teachers 

Regular 
Teachers 

CoUege 
Teachers 

0 

1914 

$10,978 

$163,947 

$7,485 

$87,911 

$7,211 

$877,430 

$4,734 

$1,159,696 

1 

1915 

10,469 

158,558 

7,162 

79,815 

5.827 

845,052 

4,460 

1,111,343 

2 

1916 

9.965 

153.209 

6,844 

72,241 

4,585 

811,979 

4,215 

1,063,038 

3 

1917 

9,484 

147.996 

6,526 

65,142 

3,494 

778,258 

3,975 

1.014,875 

4 

1918 

9,006 

142.602 

6.214 

58,485 

2,559 

743,947 

3,746 

966,559 

5 

1919 

8,539 

137.341 

5.887 

52,241 

1,793 

709,127 

3,531 

918.459 

6 

1920 

8,078 

132,112 

5,598 

46,408 

1,191 

673,888 

3,327 

870,602 

7 

1921 

7,622 

126.913 

5,300 

40,993 

742 

638,336 

3,152 

823,058 

8 

1922 

7,182 

121.747 

5.004 

36.004 

427 

602,595 

2,949 

775,908 

9 

1923 

6.741 

116,615 

4,716 

31.440 

223 

566,801 

2,772 

729,308 

10 

1924 

6,310 

111,517 

4.435 

27.298 

104 

531,098 

2,618 

683,380 

11 

1925 

5.891 

106,456 

4,160 

23.573 

41 

495,640 

2,433 

638.194 

12 

1926 

5.489 

101,437 

3,895 

20.248 

15 

460,600 

2,270 

593,954 

13 

1927 

5.098 

96.463 

3,638 

17,302 

4 

426,133 

2,109 

550,747 

14 

1928 

4,705 

91.540 

3,386 

14,712 

392,405 

1.951 

508.699 

15 

1929 

4,335 

86,672 

3.145 

12,450 

359,574 

1,795 

467,971 

16 

1930 

3,980 

81,864 

2,912 

10,489 

327,790 

1.640 

428.675 

17 

1931 

3,634 

77,125 

2,686 

8,801 

297,201 

1,490 

390.937 

18 

1932 

3,309 

72.457 

2,467 

7,352 

267,930 

1,345 

354,860 

19 

1933 

2,989 

67,872 

2.159 

6.109 

240,102 

1,204 

320,435 

20 

1934 

2,690 

63,375 

2,058 

5.045 

213.813 

1,069 

288,050 

21 

1935 

2.409 

58,976 

1,867 

4,135 

189,124 

940 

257,451 

22 

1936 

2.149 

54,683 

1,687 

3,367 

166.136 

819 

228,841 

23 

1937 

1.895 

50,507 

1,516 

2,701 

144.859 

706 

202.184 

24 

1938 

1.665 

46,447 

1,356 

2,145 

125,301 

603 

177.517 

25 

1939 

1.450 

42,522 

1,206 

1,678 

107.509 

507 

154.872 

26 

1940 

1.252 

38,737 

1,068 

1,295 

91.422 

423 

134,197 

27 

1941 

1.073 

35,104 

940 

984 

77,018 

345 

115,464 

28 

1942 

911 

31,631 

822 

735 

64,248 

279 

98,626 

29 

1943 

763 

28,327 

719 

541 

52.988 

218 

83,556 

30 

1944 

634 

25.200 

619 

391 

43,254 

172 

70,270 

31 

1945 

518 

22,262 

533 

277 

34.867 

131 

58,588 

32 

1946 

420 

19,517 

455 

194 

27.743 

96 

48,425 

33 

1947 

334 

16,972 

387 

132 

21.771 

71 

39,667 

34 

1948 

263 

14,633 

328 

87 

16.835 

49 

32.195 

35 

1949 

204 

12,501 

275 

55 

12,807 

34 

25,876 

36 

1950 

154 

10,575 

228 

33 

9,579 

22 

20,591 

37 

1951 

115 

8,855 

188 

19 

7.036 

15 

16,228 

38 

1952 

83 

7,333 

155 

10 

5,066 

9 

12,656 

39 

1953 

57 

6,002 

128 

5 

3,568 

5 

9,765 

40 

1954 

38 

4.851 

103 

2 

2,455 

3 

7,452 

41 

1955 

23 

3.871 

83 

1 

1,649 

1 

5,628 

42 

1956 

13 

3,047 

66 

1,078 

4,204 

43 

1957 

7 

2,364 

51 

683 

3,105 

44 

1958 

3 

1.806 

39 

417 

2,265 

45 

1959 

1 

1,357 

29 

243 

1.630 

46 

1960 

1.002 

21 

137 

1.160 

47 

1961 

726 

16 

78 

820 

48 

1962 

516 

12 

29 

557 

49 

1963 

359 

8 

16 

383 

50 

1964 

244 

6 

9 

259 

51 

1965 

162 

4 

1 

167 

52 

1966 

104 

2 

106 

53 

1967 

65 

1 

66 

54 

1968 

39 

39 

55 

1969 

23 

23 

56 

1970 

13 

13 

57 

1971 

7 

7 

58 

1972 

4 

4 

59 

1973 

1 

1 

Total 

1152.928 

$2,909,163 

$110,595 

$742,846 

$28,216 

$12,467,625 

$62,233 

$16,473,606 

Date  year  beginning  July  i. 


128 


Man  Teacher  A 

Age  at  entrance,  26.     Present  age,  28. 

Total  salary  for  service  prior  to  retirement  at  age  65 $105,970 

Actual  salary  for  service  prior  to  reorganization 1,900 

Teacher  entered  service  under  grade  D-i,  Assistant,  High  SchcMDls. 

Year  Salary 

1914 $900 

1915 1,000 


Estimated  Future  Salary 

Promotion  under  grade  D-i  to  the  year  1924,  then  change  to  grade  D-2 ; 
promotion  thereafter  until  maximum  has  been  reached. 

Year      Salary    Year     Salary  Year     Salary    Year     Salary 

1916 $1,100    1926 $3,150    1936 $3,150    1946 $3,150 

1917 1,300    1927 3,150    1937 3,150    1947 3,150 

1918 1,450    1928 3,150    1938 3,150    1948 3,150 

1919 1,600    1929 3,150    1939 3,150    1949 3,150 

1920 1,750    1930 3,150    1940 3,150    1950 3,150 

1921 1,900    1931 3,150    1941 3,150    1951 3,160 

1922 2,050    1932 3,150    1942 3,150    1952 3,150 

1923 2,200    1933 3,150    1943 3,150 

1924 2,730    1934 3,150    1944 3,150 

1925 2,940    1935 3,150    1945 3,150 


Woman  Teacher  B 

Age  at  entrance,  21.     Present  age,  22. 

Total  salary  for  service  prior  to  retirement  at  age  65 $91,990 

Actual  salary  for  service  prior  to  reorganization 720 

Teacher  entered  service  under  grade  B-i,  Elementary  Schools,   i-A 
to  6-B.  I'^^*^^^'^^!l*i^^ 

Year  Salary 

1915 $720 


Estimated  Future  Salary 

Promotion  under  grade  B-i,  6-A  to  6-B,  to  year  1919;  then  change  to 
grade  B-2,  7-A  to  7-B,  promotion  under  this  latter  grade  to  1924;  then 
change  to  B-3,  Assistant  to  Principal,  Elementary  Schools ;  promotion  there- 
after until  maximum  has  been  reached. 

129 


Year  Salary  Year      Salary  Year      Salary  Year     Salary 

1916 $720  1927 $2,400  1938 $2,400    1949 $2,400 

1917 720  1928 2,400  1939 2,400    1950 2,400 

1918 780  1929 2,400  1940 2,400    1951 2,400 

1919 940  1930 2,400  1941 2,400    1952 2,400 

1920 1,020  1931 2,400  1942 2,400    1953 2,400 

1921 1,100  1932 2,400  1943 2,400    1954 2,400 

1922 1,180  1933 2,400  1944 2,400    1955 2,400 

1923 1,260  1934 2,400  1945 2,400    1956 2,400 

1924 2,100  1935 2,400  1946 2,400    1957 2,400 

1925 2,250  1936 2,400  1947 2,400    1958 2,400 

1926 2,400  1937 2,400  1948 2,400 


Woman  Teacher  C 

Age  at  entrance,  21.     Present  age,  24. 

Total  salary  for  service  prior  to  retirement  at  age  65 $69,560 

A  dual  salary  for  service  prior  to  reorganization 2,940 

Teacher  entered  service  under  grade  B-i,  Elementary  Schools,   i-A 
to  6-B. 


Year  Salary 

1912 $720 

1913 720 

1914 720 

1915 780 


Estimated  Future  Salary 

Promotions  under  grade  B-i,  Elementary  Schools,  i-A  to  6-B,  to  year 
192 1 ;  then  change  to  B-2,  Elementary  Schools,  7- A  to  8-B;  promotion  there- 
after until  maximum  has  been  reached. 

Year      Salary    Year      Salary  Year      Salary  Year     Salary 

1916 $840    1926 $1,740  1936 $1,820    1946 $1,820 

1917 900    1927 1,820  1937 1,820    1947 1,820 

1918 960    1928 1,820  1938 1,820    1948 1,820 

1919 1,020    1929 1,820  1939 1,820    1949 1,820 

1920 1,080    1930 1,820  1940 1,820    1950 1,820 

1921 1,140    1931 1,820  1941 1,820    1951 1,820 

1922 1,420    1932 1,820  1942 1,820    1952 1,820 

1923 1,500    1933 1,820  1943 1,820    1953 1,820 

1924 1,580    1934 1,820  1944 1,820    1954 1,820 

1925 1,660    1935 1,820  1945 1,820    1955 1,820 


Woman  Teacher  D 

Age  at  entrance,  22.     Present  age,  33. 

Total  salary  for  service  prior  to  retirement  at  age  65 $85,240 

Actual  salary  for  service  prior  to  reorganization 9,480 

130 


Teacher  entered  service  under  grade  III,  Elementary  Schools,  Kinder- 
garten, promotion  under  this  grade  until  1912;  then  change  to  B-i. 

Year            Salary  Year            Salary 

1905 $600         1911 $840 

1906 640         1912 1,020 

1907 680         1913 1,080 

1908 720         1914 1,140 

1909 760         1915 1,200 

1910 800 


Estimated  Future  Salary 

Promotion  under  grade  B-i,  Elementary  Schools,  until  1919;  then 
change  to  B-2,  Elementary  Schools,  7-A  to  8-B;  promotion  under  latter 
grade  until  192 1 ;  then  change  to  grade  D-i,  Assistant,  High  School;  pro- 
motion following  until  maximum  of  grade  has  been  reached. 


Year      Salary  Year      Salary  Year      Salary  Year     Salary 

1916 $1,260  1924 $2,200  1932 $2,650    1940 $2,650 

1917 1,320  1925 2,350  1933 2,650    1941 2,650 

1918 1,380  1926 2,500  1934 2,650    1942 2,650 

1919 1,660  1927 2,650  1935 2,650    1943 2,650 

1920 1,740  1928 2,650  1936 2,650    1944 2,650 

1921 1,750  1929 2,650  1937 2,650    1945 2,650 

1922 1,900  1930 2,650  1938 2,650    1946 2,650 

1923 2,050  1931 2,650  1939 2,650    1947 2,650 


Woman  Teacher  £ 

Age  at  entrance,  19.     Present  age,  37. 

Total  salary  for  service  prior  to  retirement  at  age  65 $59,820 

Actual  salary  for  service  prior  to  reorganization 17,820 

Teacher  entered  service  in  Elementary  Schools ;  changed  to  grade  III, 
Elementary  Schools,  in  1900;  promotions  in  that  grade  until  1912;  then 
changed  to  B-i,  Elementary  Schools. 


Year            Salary  Year  Salary 

1898 $504  1907 $960 

1899 576  1908 1,000 

1900 680  1909 1,040 

1901 720  1910 1,080 

1902 760  1911 1,120 

1903 800  1912 1,440 

1904 840  1913 1,500 

1905 880  1914 1,500 

1906 920  1915 1,500 


131 


Estimated  Future  Salary 

No  promotion  after  1913. 


Year  Salary 

1916 $1,500 

1917 1,500 

1918 1,500 

1919 1,500 

1920 1,500 

1921 1,500 

1922 1,500 

1923 1,500 

1924 1,500 

1925 1,500 


Year 


Salary 


1926 $1,500 

1927 1,500 

1928 1,500 

1929 1,500 

1930 1,500 

1931 1,500 

1932 1,500 

1933 1,500 

1934 1,500 

1935 1,500 


Year  Salary 

1936 $1,500 

1937 1,500 

1938 1,500 

1939 1,500 

1940 1,500 

1941 1,500 

1942 1,500 

1943 1,500 


Woman  Teacher  F 

Age  at  entrance,  18.     Present  age,  49. 

Total  salary  for  service  prior  to  retirement  at  age  65 $54,015 

Actual  salary  for  service  prior  to  reorganization 30,015 

Teacher  entered  service  in  Elementary  Schools;  change  to  grade  III, 
Elementary  Schools,  year  1900;  change  to  grade  B-i,  Elementary  Schools, 
i-A  to  6-B,  year  1912. 


Year 

Salary 

Year 

Salary 

Year 

Salary 

1885 

$573 

1895 

$573 

1905 

$1,240 

1886 

573 

1896 

573 

1906 

1,240 

1887 

573 

1897 

573 

1907 

1,240 

1888 

573 

1898 

750 

1908 

1,240 

1889 

573 

1899 

936 

1909 

1,240 

1890 

573 

1900 

1,240 

1910 

1,240 

1891 

573 

1901 

1,240 

1911 

1,240 

1892 

573 

1902 

1,240 

1912 

1,500 

1893 

573 

1903 

1,240 

1913 

1,500 

1894 

573 

1904 

1,240 

1914 
1915 

1,500 
1,500 

Estimated  Future  Salary 

No  promotion  after  year  191 2. 


Year 

Salary 

Year 

Salary 

Year 

Salary 

1916 

$1,500 

1921 

$1,600 

1926 

$1,500 

1917 

1,500 

1922 

1,500 

1927 

1,500 

1918 

1,500 

1923 

1,500 

1928 

1,500 

1919 

1,500 

1924 

1,500 

1929 

1,600 

1920 

1,500 

1925 

1,500 

1930 
1931 

1,500 
1,500 

Woman  Teacher  G 

Age  at  entrance  in  New  York  City,  33.     Present  age,  43. 

Total  salary  for  service  in  New  York  prior  to  retirement  at  age  65 $73,850 

Actual  salary  for  service  in  New  York  prior  to  reorganization 18,200 

132 


Teacher  entered  service  under  grade  16-A,  Elementary  Schools,  Draw- 
ing, having  had  7  years'  outside  teaching  experience ;  promotion  until  1909 ; 
then  change  to  grade  IX-C,  Assistant,  High  Schools;  promotion  until  1912; 
then  change  to  grade  D-i,  Assistant,  High  Schools;  promotion  under  latter 
grade  up  to  time  of  reorganization. 

Year  Salary  Year  Salary 


1905 

$1,000 

1911 

fl,580 

1906 

1,100 

1912 

2,050 

1907 

1,200 

1913 

2,200 

1908 

1,300 

1914 

2,350 

1909 

1,420 

1915 

2,500 

1910 

1,500 

Estimated  Future  Salary 

Maximum  of  grade  D-i  reached  in  1916;  salary  then  remains  stationary. 

Year    Salary  Year    Salary  Year    Salary  Year    Salary 

1916  $2,650  1921    $2,650  1926    $2,650  1931    $2,650 

1917  2,650  1922  2,650  1927  2,650  1932  2,650 

1918  2,650  1923  2,650  1928  2,650  1933  2,650 

1919  2,650  1924  2,650  1929  2,650  1934  2,650 

1920  2,650  1925  2,650  1930  2,650  1935  2,650 

1936      2,650 

Man  Teacher  H 

Age  at  entrance  in  New  York  City,  38.     Present  age,  56. 

Total  salary  for  service  prior  to  retirement  at  age  65 $84,100 

Actual  salary  in  city  service  prior  to  reorganization 52,600 

Teacher  had  13  years'  outside  experience;  entered  the  service  as  ist 
Assistant,  High  School;  promoted  to  IX-F,  Assistant,  High  School,  1900; 
promoted  to  D-2,  ist  Assistant,  High  School,  1912. 

Year    Salary  Year    Salary  Year    Salary  Year    Salary 


1898 

$2,500 

1903 

$2,900 

1908 

$3,000 

1913 

$3,150 

1899 

2,500 

1904 

3,000 

1909 

3,000 

1914 

3,150 

1900 

2,600 

1905 

3,000 

1910 

3,000 

1915 

3,150 

1901 

2,700 

1906 

3,000 

1911 

3,000 

1902 

2,800 

1907 

3,000 

1912 

3,150 

Estimated  Future  Salary 

Promoted  to  C-2,  Principal  High  School,  1916  (less  than  25  classes). 

Year    Salary          Year    Salary  Year  Salary 

1916  $3,500          1919    $3,500  1922  $3,500 

1917  3,500          1920      3,500  1923  3,500 

1918  3,500          1921      3,500  1924  3,500 

133 


PART   III 
BASIS  OF  ACTUARIAL  CALCULATIONS 


CHAPTER  XII 

INVESTIGATION  OF  ASSETS  AND  LIABILITIES  OF 
PRESENT  FUND 

Benefits  and  Contributions 

In  the  valuation  of  a  pension  fund,  facts  relating  to  the  conditions  of 
retirement,  the  amount  of  benefits  and  other  details  are  developed  from  the 
experience  or  actual  working  of  the  fund  in  the  past.  To  base  a  valuation 
upon  the  statutory  provisions  alone  is  not  safe,  because  in  the  majority  of 
existing  pension  funds  the  way  in  which  discretionary  powers  are  exercised 
by  the  administration  constitutes  an  important  factor  requiring  special 
consideration.  The  following  brief  summary  shows  only  the  main  provisions 
of  the  law  considere'd  in  connection  with  the  valuation. 


Benefits  : 

Service. — Pension  of  one-half  final  salary  to  any  member  retiring 
after  30  years'  service,  provided  15  years  of  it  was  in  the  schools  of 
New  York  City.  If  the  member  does  not  have  the  requisite  15  years' 
service  in  the  schools  of  New  York  City  it  is  sufficient  if  he  be  65  years 
of  age  or  over.  Maximum  annuity. — $1,500  per  annum  for  teachers 
or  principals.  $2,000  per  annum  for  supervising  officials.  Minimum 
annuity. — ^$600  per  annum,  except  in  case  of  president  or  professor  in 
Hunter  College  when  annuity  is  increased  to  multiple  of  $1,000. 

Disability. — Pension  of  one-sixtieth  of  final  salary  for  each  year  of 
service  to  any  member  disabled,  mentally  or  physically,  after  20  years' 
service,  provided  15  of  these  years  have  been  served  in  the  schools  of 
New  York  City.     Maximum  annuity. — One-half  final  salary. 


Contributions  : 

City. — Net  absence  of  deductions  from  salary  roll;  5  per  cent, 
of  excise  moneys,  etc. 

Employees. — One  percentum  of  salary.  Maximum  contributions — 
$30  per  annum  for  teachers  and  principals ;  $40  per  annum  for  super- 
vising officials. 

To  obtain  an  estimate  of  the  cost  of  pensions  it  is  necessary  to  measure 
separately  the  various  independent  forces  upon  the  combined  action  of  which 
the  cost  of  the  pension  system  depends.  Because  of  differences  in  the 
mortality  and  service  experiences  of  the  men  and  women  employed  in  the 

137 


teaching  staff  of  the  Department  of  Education  it  was  necessary  that  a 
division  as  to  sex  be  carried  into  the  measurement  of  these  elements.  The 
factors  for  which  specific  measurement  was  required  were  as  follows: 

( 1 )  The  probable  mortality  of  members  while  in  the  active  force. 

(2)  The  probable  withdrawal  experience  or  rate  of  leaving  the 

active  force  by  resignation  or  dismissal. 

(3)  The  probable  rate  of  retirement  on  disability  pension. 

(4)  The   probable   rate   of   superannuation   retirement    from   the 

active  force. 

(5)  The  probable  mortality  of  members  on  the  disability  pension 

roll. 

(6)  The  probable  mortality  of  members  on  the  superannuation  pen- 
sion roll. 

(7)  The  probable  rate  of  salary  increase  of  members  of  the  active 

force. 


Data  Used  as  Basis  for  Valuations 

Collection  of  Schedules 

The  basis  for  the  valuation  tables  was  the  mortality  and  service  experi- 
ence of  the  force  during  the  period  from  June  30,  1908,  to  June  30,  19 14. 
To  secure  the  data  regarding  this  experience  the  record  of  every  employee 
who  had  been  in  the  active  service  or  on  pension  at  any  time  during  the  six 
year  period  under  observation  was  required.  This  information  was  obtained 
from  the  employees  directly  and  from  the  records  in  the  Department  of 
Education. 

All  information  regarding  the  persons  in  active  service  was  secured  by 
means  of  the  regular  census  schedule  prepared  by  the  Commission  and  sent 
out  to  all  the  departments  in  connection  with  the  pension  census,  made  as  of 
June  30,  1914.  Although  the  official  date  of  the  census  was  June  30th  and 
all  the  information  was  given  as  of  that  date,  the  schedules  were  not  pre- 
pared in  the  Department  of  Education  until  September,  when  the  teachers 
returned  to  the  schools  after  the  summer  vacation.  Schedules  were  sent 
to  the  principals  of  the  various  schools,  who  distributed  them  to  the 
teachers.  They  were  made  out  in  triplicate  under  the  supervision  of  the 
officials.  Two  copies  were  forwarded  to  the  Commission  on  Pensions  and 
the  third  was  retained  by  the  teacher.  A  copy  of  the  schedule  used  for 
collecting  the  data  regarding  each  employee  in  active  service  is  shown  on 
the  following  page: 


138 


inquiries 
r  to  any 
r  person 
wer  such 
o  secure 
le  neves- 

o  c  OS'*--; 

fi 

•«  C  «  •        2 

tf 

<«  E    ®   *   ® 

< 

se  great  care  In  answerin 
If  In  doubt  as  to  proper 
t  the  Immediate  superior  o 
e  head  of  the  department 
purpose  of  these  questio 
r  the  Commission  on  Pen 

H 

U 

> 

H 

g 

H 

H 

ase  exercl 
schedule 
n,  consul 
ted  by  th 

es.    The 
benefit  o 

V  en  o  '^  ->  S) 

^'^  a^  3^ 

Bass's 

C/5 

o 

CO 
U 

o 
o 

CO 


O 


a  V 

II 

•"  a 
.a 

i$  on 

OD    V 

8.0 

4«  x: 


iSri 


pa 

ha 
« 


5  ■  «l  I 


O" 


.^i  « 


J-t  I  j* 

w    a 


iiil 


•5  si  I.S.S2. 

"*  C  'Si  S    **■ 


;» 

! 

.« 

Jfe 

!  <«■ 

':'■ 

*%s 

?! 

"'  1 

"^^ 

ji 

1  «    i 

,  ■• 

^ 
H"*^ 

'we-^wwtwf-'*^--'-- 

•   W     I 

^  t- ,      « 


everv  « 


is»«w»^«»^fieWW'^«'^*ft^!«*<Mi»s«»(i 


[■S^l 


S       'St 


-i 


2   :  ~  I    3 


fyO 


i  s 


•O 


a  1*  ■ 


•■: ;  ft 
a  iirti 
-  3  ■  !  *  ' 


3n 

m 

s 


R5'- 

as  AM 

;^t    rlu: 

O    HOd 

3Si   tor 

Qij    i>r; 

CV> 

CN^ 

S 

S 

O 

O 

Schedules  of  other  colors,  calling  for  slightly  different  information  were 
prepared  for  all  employees  who  had  left  the  active  service  without  pension 
during  the  six  year  period,  for  all  pensioners  on  the  rolls  on  June  30,  1914, 
and  for  those  whose  pensions  had  terminated,  in  the  preceding  six  years. 
These  schedules  were  prepared  by  employees  of  the  Commission  on  Pensions 
from  the  records  in  the  Department  of  Education. 

Although  data  for  the  period  from  June  30,  1908,  to  June  30,  1914,  were 
to  be  used  as  a  basis  for  the  table  showing  the  mortality  and  service  experi- 
ence of  the  force,  records  were  taken  from  December  31,  1907,  up  to  the 
time  of  the  actual  date  of  collection.  By  thus  having  the  period  for  which 
the  teachers  and  other  field  workers  supplied  data  overlap,  at  either  end,  the 
period  for  which  data  were  absolutely  essential,  the  necessity  for  absolute 
precision  as  to  dates  on  the  part  of  the  field  workers  was  eliminated.  Data 
regarding  facts  not  relating  to  the  basic  period  were  easily  rejected  in  the 
office  by  mechanical  methods  and  a  precision  as  to  time  limits  secured  that 
would  scarcely  have  been  feasible  had  dependence  been  placed  solely  upon 
the  many  teachers  and  the  field  workers  who  naturally  could  not  be  con- 
versant with  all  the  requirements  of  the  census. 


Checking  Schedules  as  to  Number  and  Completeness 

The  Department  of  Education  furnished  the  Commission  with  state- 
ments showing  the  number  of  employees  on  the  payroll  in  the  various  schools 
and  divisions  of  the  department  June  30,  1914,  and  cojoperated  in  every 
way  to  make  the  work  successful.  The  schedules  received  by  the  Com- 
mission were  checked  to  this  number  to  make  sure  that  no  schedules  for 
active  employees  were  omitted.  After  the  cards  for  the  active  service 
were  checked  as  to  number  the  out  of  service  cards  were  added  and 
later,  by  means  of  tabulating  machines,  the  cards  were  assorted  so  as  to 
show  the  active  service  as  of  December  31,  1907,  and  June  30,  1914.  The 
tables  prepared  from  these  assortments  were  again  checked  against  the 
records  of  the  department.  This  check  was  for  the  purpose  of  insuring  that 
no  cards  for  persons  out  of  service  had  been  omitted.  The  same  methods 
were  employed  in  checking  cards  for  pensioners. 

In  the  active  service  schedule  shown  on  page  139,  a  small  coupon  will  be 
noted,  which  contains  the  name  of  the  employee  and  certain  other  facts. 
Similar  coupons  were  attached  to  the  schedules  for  all  out-of-service 
employees  and  pensioners.  After  the  schedules  for  all  departments  in  the 
city  government  were  received,  these  coupons  were  detached  and  arranged 
alphabetically.  By  this  method  all  duplicate  schedules  were  located  and 
removed  and  the  cases  of  employees  who  had  passed  from  one  department  of 
the  service  to  another  during  the  six  year  period  of  the  experience  were  dis- 
covered and  the  records  adjusted,  so  that  reports  for  such  persons  would 
tabulate  consistently  with  those  for  persons  employed  in  but  one  service. 

After  the  schedules  had  been  checked  for  number  and  the  coupons 

140 


assorted,  they  were  reviewed  for  apparent  inconsistencies  and  for  omissions 
of  data.  Where  inconsistencies  or  omissions  were  found,  the  reports  were 
corrected  from  the  various  departmental  records. 

Preparation  of  Punch  Cards  for  Mechanical  Tabulation 

For  purposes  of  the  tabulation  the  data  on  the  schedules  were  trans- 
ferred to  punch  cards  by  means  of  a  system  of  code  numbers.  The  follow- 
ing is  a  copy  of  the  card  used : 


Ul 


"^ 


\-- 


=t 


U.V.  C.  PEKIS!0\'  CO r>^^AlSSr5NI'/ 


dENenM 

AuuuAt 


Data 

or  Pur  Diem 


^o| 

,- 

cv 

CO 

frf 

lO 

CD| 

t>>. 

CO' 

00 

o» 

31JaiO 

O 

T— , 

CM 

CO 

't 

ID 

CD   • 

r-* 

en) 

O 
O 

^_ 

CM 
CM 

CO 
CO 

in- 
m 

CD  : 
CD  ; 

CXI 

00 

^ix 

.  o 

r- 

CM 

CO 

'^ 

lO 

CD  ; 

N- 

CO 

a» 

^ 

o 

r- 

CM 

CO 

^ 

lO 

CD 

r^ 

00 

<SP 

o 

r" 

CM 

CO 

^ 

to 

CD  • 

rv 

00 

<R> 

'^"X- 

o 

«- 

CM 

CO 

,  ^ 

If) 

<o- 

tv. 

00 

CD) 

<  2. 


o 
o 
o 


ca 

CO 

^ 

in 

CO 

r-- 

00 

C35) 

CM 

CO 

^ 

in 

CD 

h* 

00 

OT) 

CM 

CO 

^ 

in 

CD 

■r*. 

00 

0)) 

o 
o 
o 


CM 
CM 

CM 


O 

o 
o 


CM 
CM 
CM 


CO 
CO 
CO 


^  in 
"^  in 
rh     in 


CD  ;  r*- 
CD  i  r^. 

CO   '    t^ 


^  in 
"^  in 
rt     in 


CD   ,    I^ 

cD  ;  js. 

CD   '    h- 


00      o 

00    m 

CO      Oil 


00  0)> 
GO  O 
00      <TS, 


o 

O 

r- 

CM 

CO 

^t 

in 

CD 

h- 

00 

ox 

o 

O 

^ 

CM 

CO 

n- 

in 

CO 

f^ 

oo 

XJ)i 

''X 

o 

«— 

CM 

CO 

'^ 

in 

CD 

r^ 

00 

CD' 

tnaamrqa 

o 

.- 

CM 

00 

^ 

in 

CD 

h» 

00 

CDl 

J-s 

o 

»- 

CM 

CO 

^ 

in 

CD 

h- 

00 

o>> 

^-£X 

o 

- 

CM 

CO 

^ 

in 

CD 

h- 

00 

0> 

9snsp 

o 

t- 

CM 

CO 

'* 

in 

CD 

r^. 

00 

O) 

1^-5 

o 

«— 

CM 

CO 

^ 

in 

CD 

r^ 

00 

m 

i^=X 

o 

*- 

CM 

CO 

^ 

in 

CD 

r««. 

CO 

<3» 

.•0 

o 

r- 

CM 

CO 

^i- 

in 

CD 

h- 

00 

m 

-^x 

o 

T- 

CM 

CO 

^ 

in 

CD 

r^ 

00 

m 

»snc3  X 

o 

T— 

CM 

CO 

<! 

in 

CD 

r^ 

00 

o» 

■£ 
5 

o 

r- 

CM 

CO 

^ 

in 

CO 

h". 

00 

<j), 

ix 

o 

^ 

CM 

CO 

'* 

in 

CO 

h- 

00 

o>. 

_5g 

o 

»- 

CM 

CO 

-^ 

in 

CD 

r>. 

00 

O)) 

1   X 

a 

— 

CM 

CO 

^ 

in 

CD 

i^ 

00 

o> 

£ 

♦^ 

o 

<- 

CM 

CO 

^ 

in 

CD 

1^ 

00 

<«) 

a 

o 

»- 

CM 

CO 

rr 

in 

CO 

r^ 

CO 

O)) 

.ilJO^'^ 

o 

— 

CM 

CO 

^ 

in 

CD 

r>-. 

00 

<j» 

n 
n 

o 

.- 

CJ 

CO 

't 

in 

CD 

h- 

00 

o> 

5' 

o 

- 

CM 

CO 

^ 

in 

CD 

f^ 

00 

on 

o 

r- 

ca 

CO 

"* 

in 

CD 

r^ 

00 

<Si) 

1 

a 

o 

r— 

CM 

CO 

-* 

in 

CO 

IS. 

CO 

9*> 

o 
o 

r— 

CM 
CM 

CO 

CO 

-* 

in 
in 

CO 
CD 

CO 
CO 

pnxij 

o 

^ 

CM 

CO 

"«t 

in 

CO 

rv. 

00 

a> 

cn    X 

^  o 

.- 

CM 

CO 

'^ 

in 

<0 

r* 

00 

<j> 

flC    Xfio 

r- 

CM 

CO 

^ 

lO 

<0 

r^ 

CO 

o> 

9Z031 


142 


Although  the  date  of  the  wife's  birth  and  the  number  of  children  were 
not  required  in  the  valuation  of  the  teachers'  retirement  fund,  they  were  col- 
lected because  the  Commission  also  had  to  deal  with  funds  which  provide 
pensions  for  dependents,  and  it  seemed  best  to  collect  uniform  data  for 
all  employees. 

After  the  data  were  transferred  to  the  punch  cards  the  cards  were  veri- 
fied by  reading  back  to  the  original  schedule  the  information  punched  into 
them.  In  the  latter  part  of  the  investigation  this  verification  was  performed 
by  means  of  a  mechanical  checker,  devised  by  the  Commission  on  Pensions 
and  built  by  the  Hollerith  Tabulating  Machine  Company. 


Mechanical  Tabulations 

After  the  cards  were  punched  and  verified  they  were  tabulated  by  means 
of  the  Hollerith  system.  Tabulations  were  made  showing  in  detail,  by  age, 
length  of  service,  etc.,  the  number  of  employees  in  the  active  service  and  on 
the  pension  rolls,  together  with  their  salaries  or  pensions.  Summaries  of 
these  tabulations  are  shown  on  pages  164-167. 

A  tabulation  showing  the  experience  of  the  active  force  during  the 
last  six  years  was  necessary  to  measure  the  forces  on  which  the  costs  of 
pensions  depend.  The  following  table  heads  show  the  form  of  these  tabula^ 
tions  and  the  total  of  the  detail  on  the  sheets ;  the  tables  are  not  presented  in 
entirety  on  account  of  lack  of  space. 


Table  25 — actual  experience — active  service 


Age 

2 

1 

1 

1 

tn 

Q 

•Is 

xn 

18 1 

19 

20 

etc J 

De 

tail  for 

Each    A 

ge 

Total  on  Table  for  Men 

1,975 

895 

243 

56 

11 

54 

1 

2,505 

Total    on    Table    for 
Women 

13,981 

7,320 

3,111 

362 

208 

532 

1 

17,087 

Total 

15,956 

8,215 

3,354 

418 

219 

586 

2 

19,592 

US 


Table  26 — actual  experience  * — service  pensioners 


Age 

Survivors 

Entrants 

With- 
drawals 

Deaths 

Existing 

46 ] 

47 1 

48 : 

etc I 

Detail  for  Each  Age 

Total  on  Table  for  Men 

34 

133 

70 

97 

Total  on  Table  for  Women 

773 

545 

180 

1,138 

Total 

807 

678 

250 

1,235 

Table  2y — actual  experience  * — disability  pensioners 


Age 

Survivors 

Entrants 

With- 
drawals 

Deaths 

Existing 

35 1 

36 

37 

etc J 

Detail  for  Each  Age 

Total  on  Table  for  Men 

1 

10 

1 

10 

Total  on  Table  for  Women 

79 

282 

40 

321 

Total 

80 

292 

.... 

41 

331 

As  shown  by  the  schedule  (on  page  139)  the  experience  of  but  five  years 
was  used  as  regards  salary.  This  period  was  adopted  merely  as  a  matter  of 
expediency.  The  five  year  period  was  deemed  a  sufficient  basis  for  the  prep- 
aration of  salary  scales.  To  have  based  the  salary  experience  on  the  six  year 
period  used  for  the  mortality  and  withdrawal  rates  would  have  necessitated 
the  use  of  an  extra  punch  card  because  of  the  amount  of  information  to  be 
recorded,  and  would  accordingly  have  doubled  the  amount  of  work  required. 
The  added  degree  of  accuracy  and  precision  thereby  achieved  could  not  have 
compensated  for  the  added  expense  and  labor  involved.  It  is  doubtful  if  the 
rates  based  on  six  years'  experience  would  have  been  substantially  different 
from  the  rates  based  on  five. 

In  the  tabulation  for  salary  scales  the  cards  for  the  members  of  the 
active  force  were  kept  separate  from  those  for  the  members  on  pension  in 
order  that  any  selection  of  persons  for  retirement  which  might  result  from 
differences  in  salaries,  could  be  studied.  Each  card  was  tabulated  as  five 
separate  reports  for  an  employee,  according  to  the  age  of  such  employee 
at  the  time  the  salary  was  received.  The  following  shows  the  summary 
of  the  experience  used  as  a  basis  for  salary  scales. 


•This  Table  Includes  Experience  of  Fund  for  Period  Prior  to  1908. 

144 


Table  28 — actual  experience — salary  scale 


Class 

Number  of 

Annual  Salaries 

Considered 

Amount 

Men 

Women 

11,513 
77,042 

$24,123,620 
93,072,678 

Total 

88,555 

$117,196,298 

Exposure  and  Check  Tables 

The  actual  experience  tables,  discussed  on  page  143  in  connection  with 
the  tabulation  of  data,  were  used  as  a  basis  for  the  exposure  tables,  which 
show  the  number  of  persons  in  the  active  force  at  each  age  who  were  expose'd 
to  the  contingency  of  leaving  the  service  during  the  period  of  the  experi- 
ence, together  with  the  number  of  dismissals,  deaths,  retirements,  etc.  On 
these  tables  the  unadjusted  rates  of  separation  from  the  service  were  pre- 
pared. These  rates  were  then  graduated,  as  explained  later  in  the  report, 
and  the  results  were  checked  back  to  the  original  data  to  insure  that  the 
graduated  or  adjusted  rates  had  not  departed  from  the  original  data. 

After  the  exposure  tables  were  prepared  and  before  the  unadjusted  rates 
were  computed,  the  rates  prepared  by  Mr.  William  A.  Hutcheson  in  the 
recent  actuarial  report  on  the  School  Teachers'  Pension  Fund  were  checked 
into  the  experience,  and  the  expected  mortality,  withdrawal  and  retire- 
ment experience  as  found  by  these  rates  was  compared  with  the  actual 
experience  as  tabulated  by  the  Commission  on  Pensions.  As  the  result  of 
such  checking  it  was  considered  unnecessary  to  make  up  an  entirely  new  set 
of  rates.  The  following  table  for  men  teachers  shows  a  comparison  of  the 
actual  tabulation  of  withdrawals  as  made  by  the  Commission  on  Pensions 
with  the  withdrawals  which  would  have  occurred  had  the  experience  been 
the  same  as  that  shown  in  Mr.  Hutcheson's  report. 

Table  29 — comparison  of  the  number  of  separations  of  men  teach- 
ers FROM  THE  SERVICE  WHICH  WERE  RECORDED  BY  THE  PENSION  COM- 
MISSION WITH  THE  NUMBER  WHICH  WOULD  HAVE  OCCURRED  HAD  THE 
RATES  OF  SEPARATION  BEEN  THE  SAME  AS  THOSE  PREPARED  IN  THE 
FORMER  INVESTIGATION 


Resignations 

Disability 

Service 

Age 

AND  Dismissals 

Deaths 

Retirements 

Retirements 

Groups 

Actual 

Expected 

Actual 

Expected 

Actual 

Expected 

Actual 

Expected 

20-29 

157 

133.2 

16 

11.6 

30-39 

63 

69.0 

11 

26.2 

40-49 

19 

14.7 

6 

8.0 

3 

1.5 

.8 

50-59 

2 

1.9 

11 

7.5 

5 

2.7 

10 

15.6 

60-69 

2 

10 

7.9 

3 

2.7 

20 

23.9 

70  and  over 

2 

2.9 

24 

15.6 

Total. . . 

243 

218.8 

56 

64.1 

11 

6.9 

54 

55.9 

145 


Since  the  total  number  of  actual  separations  from  the  service  without 
pension  was  299  (243+56)  as  against  282.9  (218.8+64.1)  expected,  by  the 
use  of  Mr.  Hutcheson's  rates,  the  percentage  ratio  of  actual  to  expected  was 
105.7  per  cent.  There  were  65  (11+54)  cases  of  the  total  separations  from 
service  with  pensions  against  62.8  (6.9+55.9)  cases  expected,  or  a  ratio  of 
actual  to  expected  of  103.5  per  cent.  There  is  a  tendency  toward  compensa- 
tion in  the  rates,  since  Mr.  Hutcheson's  rates  provide  that  a  few  more  men 
remain  in  active  service  to  become  eligible  for  retirement,  but,  on  becoming 
eligible,  that  they  retire  at  a  somewhat  slower  rate  than  was  found  to  be  a 
fact  by  the  Commission  on  Pensions.  Because  of  this  compensation  and 
since  the  difference  is  very  slight  in  any  event,  it  seemed  inadvisable  to  cor- 
rect the  active  service  table  for  men. 

As  regards  the  mortality  among  men  pensioners,  the  following  table 
shows  the  comparison  of  the  actual  with  the  expected  deaths,  according  to 
Mr.  Hutcheson's  tables. 


Table  30 — comparison  of  the  number  of  deaths  among  men  pen- 
sioners RECORDED  BY  THE  PENSION  COMMISSION  WITH  THE  DEATHS 
THAT  WOULD  HAVE  OCCURRED  HAD  THE  RATES  OF  MORTALITY  BEEN  THE 
SAME  AS  THOSE   SHOWN   IN  THE  PREVIOUS  INVESTIGATION 


Age  Groups 

Disability 

Pensioners 

Service  Pensioners 

Actual 

Expected 

Actual 

Expected 

50-59 

1 

.8 
.5 

3 
17 
34 
16 

1.4 

60-69 

17.7 

70-79 

44  5 

80-89 

16.8 

Total 

1 

1.3 

70 

80  4 

Because  of  the  difference  between  the  actual  and  expected  in  the  case  of 
service  pensioners'  mortality  a  new  rate  was  graduated.  This  new  rate, 
however,  was  not  based  on  actual  experience  as  recorded  by  the  Commission 
but  is  a  rate  lying  between  the  one  found  by  Mr.  Hutcheson  and  the  one  indi- 
cated by  the  actual  experience  reports  of  the  Commission.  Both  the  rate 
worked  by  Mr.  Hutcheson  and  that  worked  by  the  Commission  from  actual 
experience  are  based  on  comparatively  small  numbers.  Rather  than  to 
accept  either  one  as  correct  and  to  reject  entirely  the  other,  it  seemed  safer  to 
take  a  middle  ground,  which  is  doubtless  more  nearly  the  true  ground,  and 
does  not  involve  so  wide  a  possibility  of  error. 

No  change  was  thought  advisable  in  the  rates  showing  mortality  of  dis- 
ability pensioners. 

The  rates  applicable  to  the  active  service  of  women  required  slightly 
more  modification  than  those  for  men.  The  following  table  shows  the  com- 
parison of  the  actual  experience  with  that  expected  by  the  application  of  the 
rates  in  the  former  report: 

146 


Table  31 — comparison  of  the  number  of  separations  of  women  teach- 
ers FROM  THE  SERVICE  WHICH  WERE  RECORDED  BY  THE  PENSION  COM- 
MISSION WITH  THE  NUMBER  WHICH  WOULD  HAVE  OCCURRED  HAD  THE 
RATES  OF  SEPARATION  BEEN  THE  SAME  AS  THOSE  PREPARED  IN  THE 
FORMER  INVESTIGATION 


Resignations 

Deaths 

Disability 

Service 

Age 

AND  Dismissals 

Retirements 

Retirements 

Groups 

Actual 

Expected 

Actual 

Expected 

Actual 

Expected 

Actual 

Expected 

Under  20. 

2 

2.7 

1 

.9 

20-29 

2201 

2146.4 

101 

98.9 

30-39 

821 

878.9 

94 

111.6 

10 

4.0 

40-49 

79 

69.1 

86 

82.0 

146 

133.8 

34 

37.2 

50-59 

8 

6.2 

61 

58.0 

35 

40.0 

325 

281.0 

60-69 

0.2 

18 

22.0 

17 

4.6 

146 

136.7 

TOandmore 

1 

2.1 

27 

15.4 

Total... 

3111 

3103.5 

362 

375.5 

208 

182.4 

532 

470.3 

The  disparity  between  the  actual  rate  of  retirement  and  the  rate  ex- 
pected according  to  the  former  report  was  very  noticeable ;  consequently  an 
investigation  of  the  reason  for  such  a  deviation  was  made.  The  results 
showed  that  many  teachers  who  would  ordinarily  have  retired  in  the  period 
covered  by  the  experience  used  as  a  basis  for  the  previous  report,  did  not 
retire  in  that  period  because  of  the  increase  in  salaries  anticipated  as  a  result 
of  the  "equal  pay  act"  and  the  consequent  increase  in  pensions  expected.  In 
the  year  following  the  passage  of  the  "equal  pay  act"  the  number  of  retire- 
ments was  much  greater  than  in  the  previous  year,  which  indicated  that  the 
rates  of  retirement  for  the  period  used  by  Mr.  Hutcheson  were  too  low  to 
represent  usual  rates  and  that  it  was  necessary  to  take  into  account  the  two 
succeeding  years  in  order  to  arrive  at  a  proper  rate  of  retirement.  Because 
of  these  facts,  new  rates  of  disability  retirements  and  regular  retirements 
were  prepared  in  accordance  with  the  experience  recorded  by  the  Pension 
Commission. 

Considering  the  rates  of  mortality  for  women  pensioners,  the  following 
table  shows  the  comparison  of  the  actual  deaths  with  those  expected : 

Table  32 — comparison  of  the  number  of  deaths  among  women  pen- 
sioners RECORDED  BY  THE  PENSION  COMMISSION  WITH  THE  DEATHS 
THAT  WOULD  HAVE  OCCURRED  HAD  THE  RATES  OF  MORTALITY  BEEN  THE 
SAME   AS   SHOWN    IN   THE    PREVIOUS    INVESTIGATION 


Age  Groups 

Disability  Pensioners 

Service  Pensioners 

Actual 

Expected 

Actual 

Expected 

30-39 

19 

15 

4 

2 

.3 

26.0 

22.8 

6.4 

1.9 

1 
31 
75 
60 
12 

40-49 

.8 

50-59 

35.5 

60-69 

80.2 

70-79 

62.4 

80-89 

9.9 

Total 

40 

57.4 

179 

188.8 

147 


The  mortality  among  service  pensioners  was  considered  as  being  the 
same  as  that  deduced  by  Mr,  Hutcheson,  but  in  the  case  of  disability  pen- 
sioners it  was  thought  advisable  to  reduce  the  mortality  forecast  in  order  to 
bring  it  more  nearly  in  conformity  with  the  experience  found  by  the  Pension 
Commission.  It  might  be  well  to  add  that,  when  the  former  report  was 
prepared,  the  rate  of  mortality  was  found  to  be  so  low  that  the  figures  were 
very  properly  doubted  by  the  actuary.  Since  these  results  were  obtained  from 
a  first  investigation,  Mr.  Hutcheson  modified  the  rates  to  bring  them  more 
nearly  in  harmony  with  those  shown  in  a  standard  mortality  table.  The 
present  investigation  demonstrates  the  fact  that  the  previous  experience  was 
probably  correct  and  that  it  is  probably  better  to  use  the  experience  as  found 
from  the  service  than  to  use  the  standard  mortality  tables. 

The  experience  in  respect  to  changes  in  salary  among  members  of  the 
active  force  was  not  shown  in  the  previous  actuarial  report  and,  in  fact,  was 
not  prepared  at  that  time  because  the  actuaries  were  informed  that  the 
schedules  of  the  salaries  prepared  by  the  Department  of  Education  gave  the 
changes.  These  schedules  were  therefore  used  as  a  basis  for  estimating  the 
future  amounts  and  prospective  pensions  of  employees  and  no  resort  was 
made  to  the  experience  in  regard  to  salaries.  The  Commission  on  Pensions 
did  not  rely  on  these  tables  of  the  Department  of  Education  but  prepared 
the  experience  as  to  salaries  directly  from  the  data  which  it  obtained.  The 
reports  on  the  census  schedules  showing  the  salaries  of  active  employees 
and  others  showing  the  salaries  of  pensioners  previous  to  retirement  were 
used  as  a  basis.  The  resulting  scales  of  salary  increases,  thus  based  on 
actual  experience,  demonstrate  that  the  salaries  in  the  service  increase  much 
more  rapidly  than  is  indicated  by  any  of  the  more  important  single  schedules 
of  the  Department  of  Education,  because  of  the  various  changes  in  the 
schedules  and  the  transferring  of  employees  from  a  class  covered  by  one 
schedule  to  a  class  covered  by  another  having  a  higher  rate.  The  experi- 
ence of  the  force  in  this  regard  ran  so  regularly  that  an  adjustment  was 
hardly  required  and  it  is  consequently  thought  that  the  basis  for  estimating 
the  future  salaries  is  very  reliable. 

Attention  is  called  to  the  fact  that  this  change  in  the  method  of  estimat- 
ing the  future  salaries  greatly  increased  the  estimated  liabilities,  since  the 
expected  pensions  are  necessarily  much  larger  than  those  shown  by  the  use 
of  the  salary  schedules  of  the  Department  of  Education.  The  following  dia- 
grams show  the  comparison  of  the  actual  and  adjusted  salary  rates  as  used 
by  the  Commission.  The  diagrams  are  miniatures  of  the  actual  sheets  used ; 
consequently  much  of  the  ruling  has  been  omitted  to  facilitate  reproduction. 


148 


mit 

mm 

J      1       J  """"^"^ 

:-5::::::::::::::::::::::::±::|:: 

J             i 

J 

— % 

i[ -- 

H^ 

iliBil 

, 

— 

¥^fc^:r: 

U::::::::::::::::::::::::::::::::::: 

— 1 

-T-T-.- '^ 

=• 

ti'i 

Lli...- .,.. , 

-f 1 

— 

^ 

'■  --f ±-^ — 

— 

= 

— 

-._u_^iHfi -fU|L  I'll    ill 

M i 

lX 1 

^ 



^* 

!,                                        1                    ! 

'1                      .1 

1             !        1             "    ,|1      1^ 

-  . 

kwM 

_ ,.::: - 

K-|- 

1-+    -..,. 

::::::::::::::::::::::::::t:ffi::::: 

— 



I                                    ■ ''       :      '  ■ 

1 __..T.  -^XT   X 

E 

.t 

1  ^ 

s 

t 

::::::::::::::::::::::  :i::  :  : 

I            1 

t 

' 

T 

t 

1 

1     I;    i          '1 

f 

^;ti::::::::::::::::  ::5::::':::"~ 

• 

I tIl 

\i'"T:             ": 

111'!                                         ■  s 

jit 

"Tt 1  t..i.\ 

.: \.l 

^'"V" 

lil    1         '          , 

:;i.rr -v^        rX  - 

|lf--q---^r^-- 

rtjT:::::::::;;::i::::;::;  :.._:_  __ 

t 

'       1  .    i 

^iiTi  tit    :.:  .:   .t 

■  "QUI 

1-   XI                        \vi    - 

1      :|          j 

v"l :  _ 

'* 

'      'i          i 

it  :     :  .s    : 

[■:i   1 1! 

y...z.      ... \---z 

iffir-— ht-r^H^ 

I      Utt                                     t            -      -^r-      X 

11                           \ 

fF" 

[■  •:     \     ;   •' 

^    XL                                                jS 

-■■■• 

T--ti  t- ^ 

|u'  ' 

i::it:::::::::::::::::::::: .^— . 

a 

[r  f- 

— 

§        ?5  ::::::::;:£:-£: 

— 



gj.  ^  j.„ . ._.  — 

^1    y  ;^           + 

^ 

^ 

^ 

% 

t:-      z 

P^lll    ii'     1 

X *c  — — 

= 

— 

u 

!            |\ 

^ 

—  s 

u..^                     

T 

"x_^j. x._:   ±  : 

m 

i_ 

"f 

iil_ 

-MX] 

liilL. _-    __- 

1 

^ 

~  J  -fn 

"j  '''''r''''j'  '  "'' 

J                J 

_ 

^ 

J Je 

149 


1      J       J 

1                 1      Aavivc      1 

1 

.s 

0       T 

^ 

1 

i 

; 

i 

""ci 

_    \ 

-  -    k- 

t_ 

1 

r-    h^ 

1 

t    -  i 

1 

1 

1    1 

] 

, 

^^ 

1 

f     ^ 

— - 

-^ 

. 

'  -         V     ,- 

^- 

J — 

^ 

3--=^ 

,^':      _ 

\ 

t-         .-    I 

-t 

u-  -      iv- 

■ 

--        4r 

4V 

[        f 

,                    1 

1 

::          :t 

1 

1 

1 

1.                                T      ~1 

\ 

I 

I 

i 

.    I 

--          i 

-  -t    1 

[ 

II        1  ^ 

1 

:::          jt 

-fe- 

ll      -    E^ 

1 

^                    X 

pll  -            A 

l: L 

% 

5? 

^ 

2 

^ 

T 

V 

vj    S  « 

\ 

^ 

1 

S  ?   "^  i 

\ 

.   .     8  §    fe  £ 

^ 

1 

.  ..  >o  St^ 

\ 

1 

.      .  ..   i  z  5  1 

S, 

.      ,,      ■¥    O      Si    ILJ 

^ 

% 

:  "  ^5  t  < 

N 

o  5  cj^  y 

.  1   >  £  •«  "^ 

N 

:  ::  "S  =  ^ 

9    <  =1 

< 

5  ^^ 

• 

' 

1 

!     i 

•        •          • 

i     .      J 

i 

-A 

v<nv<:    . ' 

. 

i 

« 

15a 


Graduation  of  Unadjusted  Rates 

The  unadjusted  or  actual  rates  obtained  directly  from  the  data  do  not 
run  smoothly  or  consistently  from  age  to  age,  and  consequently  are  not 
in  a  form  suitable  to  be  used  as  a  basis  for  forecasting  the  future  experience 
of  the  fund.  Although  the  experience  of  the  future  may  be  expected  to 
follow  that  of  the  past,  it  will  probably  tend  rather  toward  a  general  law 
than  toward  a  duplication  of  those  peculiar  divergencies  at  certain  ages 
shown  by  the  past  experience  and  attributable  to  the  paucity  of  the  data.  A 
curve  resulting  from  an  adjustment  or  graduation  of  the  actual  rates,  which 
eliminates  these  peculiar  divergencies  is  considered  as  reflecting  the  probable 
experience  of  the  future  more  nearly  than  do  the  unadjusted  rates.  The 
graphic  method  of  graduation  was  employed  and  all  work  was  done  on  large 
sheets  24  inches  by  34  inches  in  size.  The  plates  for  these  sheets  were  pre- 
pared especially  for  the  Commission.  The  divisions  on  the  ordinate  were 
made  on  a  graduated  scale  so  as  to  facilitate  reading  in  the  earlier  ages  to 
four  significant  figures.  The  results  of  the  graduation  were  all  tested  by 
checking  back  to  the  original  data. 


Rates  and  Comparisons 

Active  Service. — As  previously  stated,  the  most  helpful  comparative 
rates  for  use  in  connection  with  the  modification  of  the  pension  laws  of 
New  York  City  are  those  applying  to  employees  in  various  branches  of  the 
city  service.  As  the  work  of  the  Commission  has  not  yet  progressed  to  a 
point  where  a  comparison  of  these  rates  is  possible,  resort  must  be 
had  to  a  comparison  between  the  rates  of  separation  from  active  service  in 
the  New  York  School  Teachers'  Fund  and  the  rates  in  similar  teachers' 
funds  where  actuarial  valuations  have  been  made.  The  following  table 
compares  the  rates  of  withdrawal,  that  is,  of  resignation  and  dismissal,  from 
the  active  service  in  New  York  with  similar  rates  found  in  a  valuation  of 
the  Teachers'  Pension  Fund  in  New  Zealand,  prepared  by  Mr.  Morris  J. 
Fox,  government  actuary.  The  New  Zealand  valuation  was  based  on  a 
second  investigation  of  the  pension  fund  and  consequently  represents  the 
rates  in  a  fund  that  has  been  in  operation  for  a  period  of  years.  It  is 
noticeable  that  the  rates  of  resignation  and  dismissal  from  the  New  Zealand 
pension  fund  are  generally  higher  than  those  of  the  New  York  Teachers' 
Fund,  showing  that  the  service  in  New  York  City  is  apparently  more 
attractive  to  teachers  than  that  of  New  Zealand,  although  the  New  Zealand 
fund  provides  for  a  pension  of  practically  two-thirds  of  final  salary  after 
reaching  age  65. 


151 


Table  33 — comparative  rates  of  withdrawal  from  active  service 


Men 

Women 

Age 

Men 

Women 

Age 

New 

York 

Teachers 

New 
Zealand 
Teachers 

New 

York 

Teachers 

New 
Zealand 
Teachers 

New 

York 

Teachers 

New 
Zealand 
Teachers 

New 

York 

Teachers 

New 
Zealand 
Teachers 

18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 

.0012 
.0047 
.0110 
.0226 
.0271 
.0284 
.0290 
.0291 
.0285 
.0275 
.0262 
.0237 
.0216 
.0195 
.0175 
.0154 
.0141 
.0126 
.0109 
.0098 
.0087 
.0080 
.0073 
.0068 

.0490 
.0450 
.0410 
.0370 
.0340 
.0310 
.0290 
.0270 
.0250 
.0240 
.0220 
.0210 
.0200 
.0190 
.0180 
.0170 
.0160 
.0150 
.0150 
.0140 
.0140 
.0130 
.0120 
.0120 

.0025 
.0054 
.0102 
.0175 
.0258 
.0455 
.0581 
.0613 
.0621 
.0606 
.0579 
.0541 
.0498 
.0445 
.0384 
.0322 
.0263 
.0218 
.0182 
.0152 
.0127 
.0106 
.0089 
.0072 

.0310 

.0360 

.0420 

.0500 

.0570 

.0620 

.0670 

.0700 

.0720 

.0720 

.0710 

.0690 

.0670 

.0640 

.0620 

.0580" 

.0550 

.0510 

.0470 

.0420 

.0370 

.0310 

.0260 

.0220 

42 
43 
44 
45 
46 
47 
48 
49 
50 
51 
52 
53 
54 
55 
56 
57 
58 
59 
60 
61 
62 
63 
64 
65 

.0063 
.0058 
.0053 
.0050 
.0046 
.0041 
.0037 
.0033 
.0029 
.0026 
.0023 
.0020 
.0017 
.0014 
.0012 
.0010 
.0008 
.0005 
.0003 
.0001 

Oil 
Oil 
Oil 
010 
010 
010 
010 
010 
010 
009 
009 
008 
007 
007 
006 
005 
003 
002 

0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 

.0058 
.0044 
.0034 
.0027 
.0022 
.0018 
.0015 
.0014 
.0013 
.0012 
.0011 
.0010 
.0010 
.0009 
.0008 
.0007 
.0007 
.0006 
.0005 
.0004 
.0003 
.0002 
.0001 
.0001 

.0190 
.0160 
.0130 
.0100 
.0050 

The  rate  of  mortality  in  the  active  service  among  New  York  teachers  is 
not  compared  with  the  rate  used  in  the  New  Zealand  valuation,  as  the  latter 
rate  was  not  developed  from  the  experience  of  the  fund,  owing  to  the  lack 
of  sufficient  data  in  regard  to  mortality  observed.  For  purposes  of  compari- 
son resort  was  therefore  made  to  the  first  Septennial  Actuarial  Report  on  the 
condition  of  the  Elementary  School  Teachers'  Deferred  Annuity  Fund  of 
England  and  Scotland,  prepared  by  Mr.  George  King,  Actuary.  A  compari- 
son of  the  mortality  rates  in  that  fund  with  those  in  the  New  York  Teachers' 
Fund  shows  that  the  mortality  among  the  New  York  school  teachers  is  lower 
than  that  among  the  British  teachers.  The  difference  in  mortality  is  prob- 
ably attributable  to  the  fact  that  the  New  York  pension  fund  has  a  provision 
for  retiring  teachers  when  they  are  disabled  on  a  disability  pension  and 
hence  those  who  remain  in  the  active  service  are  in  comparatively  good  health 
and  consequently  have  low  mortality  rates. 


152 


Table  . 

34 — COM 

PARATIVE  RATES 

OF  MORTALIT\ 

'  IN  ACTIVE  SERVICE 

Men 

Women 

Age 

Men 

Women 

Age 

New 

York 

Teachers 

Teachers 
England 

and 
Scotland 

New 

York 

Teachers 

Teachers 
England 

and 
Scotland 

New 

York 

Teachers 

Teachers 
England 

and 
Scotland 

New 

York 

Teachers 

Teachers 
England 

and 
Scotland 

18 

.00093 

.00108 

50 

.00451 

.01009 

.00746 

.00758 

19 

.00112 

.00117 

51 

.00490 

.01093 

.00795 

.00826 

20 

.00128 

; 00263 

.00128 

! 66276 

52 

.00528 

.01184 

.00849 

.00903 

21 

.00144 

.00343 

.00141 

.00289 

53 

.00572 

.01280 

.00907 

.00982 

22 

.00165 

.00402 

.00156 

.00300 

54 

.00622 

.01384 

.00971 

.01065 

23 

.00182 

.00442 

.00175 

.00308 

55 

.00695 

.01496 

.01040 

.01152 

24 

.00198 

.00467 

.00201 

.00312 

56 

.00798 

.01617 

.01117 

.01245 

25 

.00221 

.00480 

.00227 

.00315 

57 

.00876 

.01747 

.01200 

.01342 

26 

.00238 

.00484 

.00252 

.00316 

58 

.00960 

.01888 

.01291 

.01446 

27 

.00263 

.00482 

.00277 

.00317 

59 

.01044 

.02042 

.01390 

.01558 

28 

.00297 

.00474 

.00302 

.00318 

60 

.01134 

.02209 

.01499 

.01678 

29 

.00350 

.00463 

.00319 

.00319 

61 

.01343 

.02393 

.01618 

.01809 

30 

.00432 

.00451 

.00332 

.00320 

62 

.01554 

.02594 

.01748 

.01952 

31 

.00540 

.00438 

.00342 

.00321 

63 

.01800 

.02815 

.01889 

.02109 

32 

.00611 

.00428 

.00351 

.00322 

64 

.02080 

.03060 

.02044 

.02284 

33 

.00629 

.00419 

.00356 

.00323 

65 

.02338 

.03330 

.02213 

.02480 

34 

.00608 

.00413 

.00360 

.00324 

66 

.02565 

.03629 

.02398 

.02699 

35 

.00585 

.00411 

.00363 

.00325 

67 

.02850 

.03961 

.02600 

.02945 

36 

.00560 

.00414 

.00374 

.00326 

68 

.03180 

.04330 

.02820 

.03224 

37 

.00533 

.00421 

.00388 

.00327 

69 

.03380 

.04739 

.03060 

.03540 

38 

.00483 

.00434 

.00403 

.00330 

70 

.03600 

.05193 

.03322 

.03898 

39 

.00409 

.00451 

.00420 

.00335 

71 

.03874 

.05698 

.03608 

.04303 

40 

.00330 

.00475 

.00438 

.00343 

72 

.04237 

.06258 

.03920 

.04763 

41 

.00317 

.00503 

.00458 

.00357 

73 

.04723 

.06880 

.04260 

.05303 

42 

.00282 

.00538 

.00480 

.00377 

74 

.05366 

.07569 

.04630 

.05905 

43 

.00275 

.00577 

.00504 

.00403 

75 

.06201 

.08333 

.05034 

.06577 

44 

.00265 

.00623 

.00530 

.00436 

76 

.07261 

.09185 

.05564 

.07314 

45 

.00257 

.00674 

.00558 

.00476 

77 

.08581 

.10053 

.06313 

.08109 

46 

.00275 

.00730 

.00590 

.00522 

78 

. 10196 

.10963 

.07373 

.08955 

47 

.00325 

.00791 

.00624 

.00574 

79 

.12139 

.11914 

.09847 

48 

.00350 

.00858 

.00661 

.00630 

80 

.14447 

49 

.00380 

.00931 

.00702 

.00692 

81 

.15861 

A  comparison  between  the  rate  of  invalidity  for  the  New  York  men 
teachers  and  the  corresponding  rate  for  New  York  women  teachers,  and  a 
further  comparison  between  these  rates  and  those  found  in  certain  other 
experiences  show  rather  interesting  results.  No  rates  are  available  from  the 
two  valuations  previously  mentioned,  but  comparison  may  be  made  with  the 
rate  of  invalidity  generally  used  by  life  insurance  companies  in  valuing  the 
effect  of  "waiver  of  premium"  clauses  in  their  policies.  This  rate  was 
derived  from  the  experience  of  fraternal  orders  in  the  United  States  and  is 
shown  in  the  following  table.  It  will  be  seen  that  the  rate  of  invalidity 
among  men  is  lower  than  the  insurance  rate,  which  would  indicate  that  the 
men  teachers  do  not  retire  until  their  health  has  been  seriously  impaired. 
The  rate  for  the  women  teachers,  however,  is  higher  than  the  insurance  rate 
and  much  higher  than  the  rate  for  men  teachers.  This  fact  would  seem  to 
indicate  that  many  women  teachers  retire  with  but  minor  health  impairments. 
The  tables  giving  the  rates  of  mortality  among  disability  pensioners,  pre- 
sented later  in  this  report,  tend  to  confirm  this  deduction  and  indicate  further 
that  although  these  pensioners  may  be  disqualified  from  performing  properly 
their  duties  as  teachers,  their  impairments  from  the  physical  standpoint  have 
not  as  a  class  been  serious. 

163 


Table  35 — comparative  rates  of  disability  in  active  service 

Age 

New  York  Teachers 

Fraternal 
Orders 

Men 

Women 

in 
United  States 

37 

38 

.6661 
.0002 

.0003 
.0004 
.0005 
.0006 
.0007 
.0008 
.0008 
.0009 
.0009 
.0010 
.0010 
.0013 
.0018 
.0023 
.0028 
.0033 
.0038 
.0043 
.0049 
.0056 
.0064 
.0073 
.0082 
.0080 
.0076 
.0070 
.0062 
.0044 
.0022 
.0006 

.0004 
.0016 
.0029 
.0045 
.0064 
.0088 
.0103 
.0110 
.0113 
.0114 
.0114 
.0112 
.0106 
.0090 
.0081 
.0077 
.0074 
.0073 
.0072 
.0071 
.0071 
.0071 
.0071 
.0071 
.0070 
.0070 
.0069 
.0068 
.0065 
.0061 
.0054 
.0044 
.0030 
.0001 

.0007 
.0007 

39 

.0008 

40 

.0008 

41 

.0009 

42 

.0009 

43 

.0010 

44 

.0011 

45 

.0012 

46 

.0012 

47 

.0013 

48 

.0014 

49 

.0016 

50 

.0017 

.0019 

52 

.0020 

.0022 

54 

.0025 

.0028 

56 

.0031 

.0035 

58 

.0040 

.0046 

60 

.0054 

.0063 

62 

.0074 

.0088 

64 

.0104 

.0124 

66 

67 

68 

70 

No  comparison  is  made  of  the  rates  of  regular  or  service  retirement  with 
those  of  other  services,  as  such  rates  are  so  largely  dependent  upon  the 
pension  provisions  in  force  that  the  figures  are  not  comparable.  The  follow- 
ing table  gives  the  rates  used : 


Table  36 — rates  of  service  retirement  from 

active  service 

Age 

Men 

Women 

Age 

Men 

Women 

46 

.0003 

64 

.0559 

.1318 

47 

.0004 

.0053 

65 

.0656 

.1502 

48 

.0014 

.0112 

66 

.0766 

.1745 

49 

.0026 
.0041 

.0183 
.0282 

67 

68 

.0916 
.1108 

.2040 

50 

.2430 

51 

.0061 

.0370 

69 

.1326 

.2890 

52 

.0084 

.0455 

70 

.1680 

.3370 

63 

.0108 

.0520 

71 

.2075 

.3880 

64 

.0132 

.0578 

72 

.2505 

.4400 

65 

.0159 

.0637 

73 

.2980 

.5040 

66 

.0185 

.0697 

74 

.3470 

.5660 

67 

.0212 

.0752 

75 

.3980 

.6280 

68 

.0241 

.0819 

76 

.4510 

.7000 

69 

.0274 
.0313 
.0360 

.0883 
.0950 
.1028 

77 

78 

79 

.5060 
.5630 
.6240 

.7820 

60 

.8790 

61 

.9860 

62 

.0413 

.1109 

80 

.6890 

63 

.0478 

.1200 

81 

.7610 

154 


Pensioners. — The  following  table  shows  the  rates  of  mortality  which 
were  used  as  a  basis  for  the  valuation  of  annuities  to  persons  on  pension. 
They  have  been  compared  with  various  tables  showing  mortality  among 
persons  in  similar  groups  but  such  comparisons  are  not  shown.  In  a  sub- 
sequent report  of  the  Commission  on  Pensions  a  comparison  of  the  mor- 
tality among  pensioners  of  the  Department  of  Education  will  be  made  with 
mortality  among  pensioners  of  other  city  departments. 


Table  37 — rates  of  mortality  among  pensioners 


Disability 

Service 

Disability 

Service 

Age 

Pensioners 

Pensioners 

Age 

Pensioners 

Pensioners 

Men 

Women 

Men 

Women 

Men 

Women 

Men 

Women 

38 

.02800 

.02410 

71 

.08120 

.06710 

.07380 

.04773 

39 

.02970 

.02440 

72 

.08479 

.07140 

.07780 

.05226 

40 

.03132 

.02470 

73 

.08820 

.07590 

.08230 

.05731 

41 

.03270 

.02500 

74 

.09138 

.08100 

.08750 

.06285 

42 

.03393 

.02530 

75 

.09437 

.08660 

.09330 

.06889 

43 

.03537 

.02570 

76 

.10231 

.09300 

.09990 

.07551 

44 

.03672 

.02600 

77 

.11106 

.10000 

.10700 

.08260 

45 

.03822 

.02640 

78 

.12083 

.10800 

. 11520 

.09019 

46 

.03884 

.02680 

.03850 

.01324 

79 

.13173 

.11650 

. 12480 

.09882 

47 

.03939 

.02720 

.03870 

.01374 

80 

.14447 

.12600 

.13580 

. 10793 

48 

.03996 

.02780 

.03890 

.01427 

81 

.15861 

. 13700 

.14970 

.11771 

49 

.04048 

.02830 

.03910 

.01481 

82 

.17430 

.14830 

.16470 

.12835 

50 

.04088 

.02900 

.03930 

.01533 

83 

.19156 

.16050 

.18200 

.13970 

51 

.04121 

.02960 

.03950 

.01585 

84 

.21136 

.17250 

.20200 

.15207 

52 

.04160 

.03020 

.03970 

.01642 

85 

.23555 

.18510 

.22500 

.16524 

53 

.04179 

.03110 

.03990 

.01694 

86 

.26568 

.19900 

.25250 

.17946 

54 

.04207 

.03200 

.04020 

.01753 

87 

.30302 

.21400 

.28400 

.19466 

55 

.04228 

.03290 

.04070 

.01812 

88 

.34669 

.22900 

.31800 

.21096 

56 

.04245 

.03400 

.04110 

.01873 

89 

.39586 

.24500 

.35800 

.22835 

57 

.04264 

.03500 

.04180 

.01938 

90 

.45455 

.26300 

.40400 

.24690 

58 

.04288 

.03630 

.04260 

.02010 

91 

.53247 

.28250 

.45600 

.26664 

59 

.04323 

.03770 

.04360 

.02092 

92 

.63426 

.30300 

.51100 

.28759 

60 

.04358 

.03920 

.04480 

.02179 

93 

.73418 

.32400 

.57500 

.30979 

61 

.04526 

.04090 

.04600 

.02288 

94 

.85714 

.34650 

.65000 

.33321 

62 

.04694 

.04270 

.04760 

.02404 

95 

1.00000 

.37100 

.73400 

.35787 

63 

.05092 

.04480 

.04940 

.02546 

96 

.39700 

.81800 

.38375 

64 

.05531 

.04670 

.05160 

.02710 

97 

.42500 

.90200 

.41082 

65 

.06019 

.04880 

.05380 

.02900 

98 

.45500 

.98500 

.43899 

66 

.06338 

.05130 

.05660 

.03121 

99 

.48800 

.46820 

67 

.06671 

.05390 

.05930 

.03370 

100 

.52400 

.49836 

68 

.07000 

.05690 

.06260 

.03664 

69 

.07379 

.06000 

.06600 

.03991 

70 

.07749 

.06330 

.06980 

.04358 

Service  and  Mortality  Tables 

To  combine  the  various  derived  rates  in  a  form  to  facilitate  their  use  in 
the  computation  of  the  cost  of  the  various  benefits,  service  and  mortality 
tables  were  constructed.  By  use  of  the  ratios  between  the  figures  at  different 
ages  in  any  one  of  these  tables,  it  is  possible  to  derive  directly  the  probability 
of  the  happening  of  any  event  without  the  necessity  of  using  a  combination 
of  several  of  the  rates  previously  shown.    The  active  service  table  assumes 

155 


icx),ooo  persons  in  the  service  at  age  i8  and  then  follows  the  history  of  these 
persons  until  they  have  all  left  the  service  on  pension  or  otherwise.  The 
table  shows  the  number  which  will  leave  at  the  end  of  each  year.  The  his- 
tory of  this  assumed  group  is  based  upon  the  experience  of  the  teaching  force 
during  the  six  year  period  investigated,  being  derived  from  the  graduated 
rates  which  were  in  turn  derived  from  the  rates  based  on  the  actual  experi- 
ence. 

The  columns  of  the  tables  are  headed  so  as  to  be  self-explanatory  and 
have  in  addition  symbols  which  will  be  helpful  in  using  figures  from  the 
tables.    For  example: 

I  ^^^     =  the  number  living  in  the  active  force  at  age  x. 

W  ^x*    ~  ^^^  number  resigning  or  being  dismissed  from  the  service  between  the  ages 

of  X  and  x  ■+■  1. 
d  ^x'     ~  ^^^  number  of  deaths  between  the  ages  of  x  and  x  +  1. 
*  7*  ^'^  =  the  number  of  disability  retirements  between  the  ages  of  x  and  x  -[-  1. 
=  the  number  of  regular  retirements  between  the  ages  of  x  and  x  +  1. 


(a) 


The  small  letter  in  brackets  used  as  an  affix  to  the  symbol  indicates  the 
table  to  which  the  symbol  applies ;  for  example,  the  small  (a)  indicates  that 
the  symbols  are  taken  from  an  active  service  table.  The  symbol  I  (p>  indi- 
cates the  number  of  regular  pensioners  living  at  age  x,  while  I  ^*)  represents, 
similarly,  the  number  of  disability  pensioners  living  at  age  x.  The  column 
marked  "salary  scale"  is  given  in  connection  with  the  active  service  table  and, 
as  previously  explained,  the  ratio  between  the  figures  opposite  one  age  and 
that  opposite  a  later  age  is  the  rate  at  which  salaries  increase  in  the  period 
between  these  ages.  The  salary  scale  must  not  be  used  as  representing  the 
actual  future  salaries  on  which  the  amount  of  a  teacher's  pension  will  be 
based.  It  is  given  in  the  active  service  table  because  the  values  in  that  table 
are  generally  used  in  combination  with  it.  The  following  are  the  tables  for 
both  men  and  women : 


156 


Salary 

Scale 

Sx 

U5»0»00»OQOOOOOO»00»0>000»COOOOOOO»OiO»0«00 

lOooowTfSixJOOiQ—ifNC^eoeceoeceofNiM^orooot^co-^coNO^ 

Total 
Decre- 
ment 

c<i«0'*»ococ<it^oooo(Meo'*i-tT-iio^o-*ioc<io»ooi-iecc<iot-oor»os^ 
rH'5'ose«50s»coo.-HTt<0503QOoo-*'Oeo(Ni>oeooia5Tj4ot^<Nooi^cO'-i 

00  0>  O  <N  CO  lO  «0  00  0>^0  C^-*^<©  00  05^0 '-H_'-<^i--i^'-^_i»  <»  C<l^l^'-<_t^  ec  tH 

Service 
Retire- 
ments 

'    X 

o>0'-Hcoo5r^asaiTt<oi<oo5(N»0'*»oeo(N(NC<it^05'*if3Tj<0'-H'-H«ooeo 

COOOOa)'-H(M<N(NeO-*t^OiCCt^'-l(M<©05Tj<f-(M05eON.'-l(NCOO»OrH 

co-*io«ooooiO^(Nec-*»ci^ooO'-<(Nec'>*o»cc<i05-*ooeO'-H 

Disa- 
bility 
Retire- 
ments 

'    X 

50rHt^^TificTtic<ii-ii-ic<i(roi>ooecTt<co«Oi--05 

i0t^05(N-^cO00O<N-^CO00OJi©e«305iO05-* 

en 

1   '^ 

(Na>OOQOOOO»Ci0005.-H(M(NOOOO(N'*t^(MrH(NOlI^COOOO«5t^<-HCCi-H 
I^00O(NtOO(N«Ot^00»0O>Oa5'-i— iOOO(M>Ot^OOO(NiOOiO(N>-H 

(M(Ne«3eoeO'*Tt*'*-<}<Tt<»o<©coot^t^i>o<©«OTi<cocoo<'-H.-< 

With- 
drawals 

«0  «£>  00  O  (M  O  05  l^  fO  CO  ■* 
I— 1  I— 1  I— ( 

3     -^ 

^OSCOOS'*^05C^T+(50Tt<,-it^(Oi000505»00000>'-HOt^"3»OOOOCO'^ 
00«0(N(M05O'*«0-*05O<-l(MTt<O'*O00'^^t^r-0>i0rt4t^»OCD05C^ 

lOTjrco'c^T'-rcrocrco'ioirot-rod'cd'ec'o'b-r'^'i-H^oO'o'c^roroTjrcsri-r 
u3»oioir3ir3iO'*'*-*-*Ti<eccQcoeO(Nc<jc^'-"'-i.-i 

O 
< 

rH(MCC-*U3<©t^00050T-i(NeOTt*iC<fflt>-00050i-i<NeC'<*<»0<Ot^OOa>0'-! 
»f5»0»00»0»OiO«0>OCOOcOOi©«0«OOiOCOl>-t--I>>l>l^t^I>t^l>»l>0000 

Salary 

Scale 

Sx 

OOr»Oi-iiOiO»CiOOI>000000«0»000»000»00»00000»C«30 
C<HC05»0(NOOO^(N'-H(N(N»-ii-iOOOCO-*OiOi-Hl^(NI>eC050<MQOCCOOC3 
l>I>t^00050'-i(MCOTtilC50t>-000500'— l(NCOC«3T}<TjHiOiCcOCOr-00  O0_O2  os_o_ 

^rt"^~,4"rH"i4",4~,4",-r.--rc<rcf(N"c<rc<f(N~c<rc<rc4"c^"c<rc<rc^^ 

Total 
Decre- 
ment 

ccT-^oooot^Oi?Oi-t030oa)«o^-*OTj<.-(i-irjHooect^oococooocot^«ooec-«n 

^OOi-nOiC0  05CO'-He0^05-*(MOOi-Hl^COOOt>-iOCOCOC<Jl^rJ<OOOt^05-*00 

(N  iQ c<i_co ^-^oq^^^^-;^o^'*^M o^as^oq^cq^iq^co c^i^o^os oot>-cocoio>o>ort*Ti<'^io?ot» 

i-rc^"(N"(N"c<rc<rc^cfcfc^i--ri--rf-ri--ri-ri-^t-r 

Service 
Retire- 
ments 

\'    X 

eoooor-* 
MoOTj^eo 

Disa- 
bility 
Retire- 
ments 

'    X 

<©  <N  00  •*  o  CO  "-I  r>.  ?o  N  i-<  <© 

Deaths 

ece«t^»-l0005  00Wr-lOC0Orl<kOC000->*Ot^C0CO<r)-*r}*i-li0t^.-<i-i00i-t«0Tt< 

a>'-t(N-*ioot^oi0^ect^(NOicoeoi-<05i©-*oiooo5t^'©io«ccoooO'-<»o 

With- 
drawals 

OC5rHiO(NOO(MOOeOC<J05^COOO(NO'^'*'H(N^'-iO^OO»OTt<0500COOOeO 

(NcD05r-io5co.-H-*.-4iooo(NC^c^-<i<i^<r>-*.-Heooo»0'-ioO'*.-(050eci-Hoo«o 

i-H-.l<0(NiOOO>OT}<  (N^0^00__0_->*_C<>_0_05  OOt^COlOlO-^rJ^CCCOCOIMe^C^KNi-tt-l 

Or^COOO(N(MiOiOC<l^(M-*»0005»C»0»-i005»Or-.rt<t^C5eOOC<lC005'^00>0 
OOOOMC«500lr^OO>Cl-^t^»Oi0^00005(NC50COt^^'*rHTj<0  05  0(NeOOOOO 

o  i>(N  05  CO  00  o  c^^''^05,"*,^^o,'-ic^co_o^t> -^^tj*  ■*_^oq_'-H_ic  05_Tr_oo -*__05_-*^oq_(N 

0050503050505000000t>.b-l^t>t>-COCOCOCOCOCOCOCOCOCOiOiO'0"3iOiOiOkO 

O 
< 

00050^(NW^tCCOt^00050.-i(NCOTj<iOCOI>OOa>0^(Me<5rt*»0<Ot^OOO>0 
^i-H(N<N(N(N(N(N(M<N(N(NCOeOWCOCOeOCCCCCOeOTt<Tj<T}HTl<Tli-*Tl<T}<Tj<Ti<iO 

157 


Salary 
Scale 

Sx 

OOOPqOiO'-lOiiC^OTt^OOOOOtNfNOiOOOOOCOiCiOiOiO 
iCtOOI^t^.OOOOOOO'-HIMCO-^lCCDI^OOO'-HeOlOiOOOOCOiCt^ 

t>._^t>  t>^t>^r>^i>_i>_i>_oo  00  00  00  c»  00  oq^oq_oo  go  os  os  oj  05_0i  o  o  o  o  o^ 

Total 
Decre- 
ment 

O5<MCOt>.T-ieClTHlO00t^-^t^TtlO5-*lMl>00e0rHTj<lCI>lCr-l-<*<-<l<r-H 
i-IOS(0050  00COOOO'H(Ni-l0  05(N-*eO'-H?Ot^OOi-H0005'*T-H 

00  05^0  0'-iooo505oot^coiccoeoc<ji-ioooio-*cO'-H 

T-^TH"c<^c^"c<fc>f(^^14■IH~rH"1H"l-^',-^,-^I-^1-^l-^T-^ 

Service 
Retire- 
ments 

'     X 

i-ICOOaiOO>OI>lOCOOO<N(NCDOSr-HOlOt^eOOCOOS(NOOOOeO'*rH 
■>*'*Tf<O5(MC0O00C0i£lO(MC0>OrHtD00ait^'-l-*c0t-00C0t-l 
C^-*^U5_0  <0  cq_«q_"5_«0 -^^^-^^CO  (N^i-J^^O  OS  OO  1>  O  -*  <N  i-h 

Disa- 
bility 
Retire- 
ments 

'    X 

r-llL0Oi-H>^t^(NI>C005?DC0»-IO05t^<©l^00<N 

I^Tt<<NOOOCOiCCO(N00500l>CD'<J<eO(N'-H 

C<JC<l(NC<lT-4T-Hr-l.-li-HrH 

to 

1  ^ 

Q 

t^05  0a>co(Nt^a>(N(NrHooioa>-*iccO'*(N05i-Hi£>u:)i>eO'H 

CDcOt^<£>COO>0^'*eC(N005t^CO'*(NOOOiO->*(N'-i 
(N  (N  (N  (N  (N  (N  (N  CI  (N(N  (N  (N  T-l  T-H  rH  tH  rt  ri 

With- 
drawals 

OlOOOOCCOSiC^OOOlO-^WrH 
■*COCC(N(Ni-^i-iT-i,-i 

OiOOOC^lOrJHr-lOOt-OiCaiOOCflOCOiCfNi-Hl^lNlOOOSlOr-l 

ici>i>cD»OTj<eoeoi:OTt<cD05<Nt-coooococDOOT-tcOcoi-i 

w 
o 
< 

'-H(NCO'*iOCOt>0005  0i-HC<1CO'^>OCDl^0005  0'-H(MCO-*iOCOt^OO 

Salary 
Scale 

Sx 

00(Ni-ifOOfO<Ni-HOO>-HrHOcOC<IO»OOCDO'-l050  0C00500051>0  000 
COt^OOOiT-HfOCOO»dOCOC<100CCOi":iOCOOl0  05(N5D03i-HCOiCt^05i-H(NeCi-* 
tOcDCDCDl>I>.l>.0000OiO5  0_0_i-H_rH^C<l_eC^eO_rlH_Tj^^TJ<_U5^iO  lO  (O_(;0_cq^0_(©  t>^l>^I>^ 

Total 
Decre- 
ment 

00>OI©rHl^C<)t^lCOi-H05i-HC0lOrJ^O(M00Oi-lO00lOOC0C0»ClX>rHlOC0r-<t^ 

iCiCCC»0(MrHTt<rHCOTtH>05(NlOg5b-i-HTj<-*i-lTt<a)0005(N(NOOOOOlO-*(©t-l 

CO  CD  T-H_00^<O^Tt<^M_M__0^0^'-H^eO  C<I^I>^5»_00  »C  (N_0^05  COt^l>I>00O0001>l>O5  1-1,00  CO 

.-H~i-H"c^'"T^'"lO~lO'lO~TtrTjH~eo'co"c4'C<rr-ri--ri-H"T-H'                                                                               T-Tr-TT-r 

Service 
Retire- 
ments 

'    X 

(MeO(N00'-( 

i-HO(NCOC2 

(N-^CDO 

Disa- 
bility 
Retire- 
ments 
•   (a) 

'    X 

05(N(N0000'*(NO5C0O.-l.-HC0Q0 

to 

Q 

00t^C000O'*0005  00f0t^»O(NC0e0t^(N00O5'-<>O0500O5lOOl^'*<Ni-l05C0(N 

With- 
drawals 

OOOOfOt^0005i©C^OO<NCD-*05'-i050  0  0i-^COt^'*eOt^'*05  05t^OCD.-lCO 
lO  CO  i-Ht-(l^Tt<OC<lcDCOt^OO(N>OOOOCOt^t^'-H  001^05  r-(TtHOOeOOOOt>»OkO'^ 
(N  IC  O  t-^^TtH^IN^i-H^r-J^OO  Tf^ro '^  O^IO  i-H_CD  CO  O  00  r^U5Tt<eOC0(Ni-H.-H,-H 

T-4~,-4~C<rTjH"»0»OrjrTirco~COC«3'c<f(N~T-^~<-H~i-H' 

0(MI>i-(OCO'-H->*0505  0005  00(Nt^COI>l01>OOI>t^Ort<rtHX<NI>'-<OiOl>(£> 
0'*00>OOI>Ot-(05e005i-l<NO-*kCt^CDi-iOiOT-ti-HeO-*'-i03  000(MCDT-nO 
O  «D  OOO  0_CO  05_C0  C<J,C<J_  >0_•«i^^^-__  »0  t^-^^iO  O  00  1>  00  o_(^ 

cToTocTt^rio'oj'od'c's'oo  CO  oc^rJ^"o"^-^T)^c^"c^o^^-^l©~l/^^l:^•^"co"c<^'-^o"o  oToo  t^  coio 

00>050505050000l>I>i©«OCO»0>0»Oir5'*-*Tt<TjHTtlTjHTt<-<^-*Tl<-«4(eOCOCCCOCO 

O 
< 

00050i--t(NCOTj<iCCDt^00050i-HC^CO'<*<»CC01>00050rHC3CO;^i250b-OOg50 
»-l»-i(NC^lN<NC^C<IC^C<lC^(NC0C0CCC0C0C0C0C0eOC0'Tt<-*Tl<-ii<^TitTl*rt<'<**Ti<kO 

158 


Table  40 — service  pensioners^  mortality  table — men 


Living 

Djdng 

Living 

Dying 

Age 

I'f 

d%' 

Age 

fv) 

d'^J 

49 

71,708 

2  804 

74 

19,046 

1,667 

50 

68,904 

2,708 

75 

17,379 

1,621 

51 

66,196 

2,615 

76 

15,758 

1,574 

52 

63,581 

2,524 

77 

14,184 

1,518 

53 

61,057 

2,436 

78 

12,666 

1,459 

54 

58,621 

2,357 

79 

11,207 

1,399 

55 

56,264 

2,290 

80 

9,808 

1,332 

56 

53,974 

2,218 

81 

8,476 

1,269 

57 

51,756 

2,163 

82 

7,207 

1,187 

58 

49,593 

2,113 

83 

6,020 

1,096 

59 

47,480 

2,070 

84 

4,924 

995 

60 

45,410 

2,034 

85 

3,929 

884 

61 

43,376 

1,995 

86 

3,045 

769 

62 

41,381 

1,970 

87 

2,276 

646 

63 

39,411 

1,947 

88 

1,630 

518 

64 

37,464 

1,933 

89 

1,112 

398 

65 

35,531 

1,912 

90 

714 

288 

66 

33,619 

1,903 

91 

426 

194 

67 

31,716 

1,881 

92 

232 

119 

68 

29,835 

1,868 

93 

113 

65 

69 

27,967 

1,846 

94 

48 

31 

70 

26,121 

1,823 

95 

17 

12 

71 

24,298 

1,793 

96 

5 

4 

72 

22,505 

1,751 

97 

1 

1 

73 

20,754 

1,708 

Table  41 — service  pensioners'  mortality  table — women 


Living 

Dying 

Living 

Dying 

Age 

If 

df 

Age 

If 

df 

45 

81,633 

1,040 

75 

36,042 

2,483 

46 

80,593 

1,067 

76 

33,559 

2,534 

47 

79,526 

1,093 

77 

31,025 

2,563 

48 

78,433 

1,119 

78 

28,462 

2,573 

49 

77,314 

1,144 

79 

25,889 

2,558 

50 

76,170 

1,168 

80 

23,331 

2,518 

51 

75,002 

1,190 

81 

20,813 

2,450 

52 

73,812 

1,211 

82 

18,363 

2,357 

53 

72,601 

1,231 

83 

16,006 

2,236 

54 

71,370 

1,251 

84 

13,770 

2,094 

55 

70,119 

1,269 

85 

11,676 

1,929 

56 

68,850 

1,290 

86 

9,747 

1,749 

57 

67,560 

1,310 

87 

7,998 

1,557 

58 

66,250 

1,332 

88 

6,441 

1,359 

59 

64,918 

1,357 

89 

5,082 

1,160 

60 

63,561 

1,386 

90 

3,922 

969 

61 

62,175 

1,421 

91 

2,953 

787 

62 

60,754 

1,462 

92 

2,166 

623 

63 

59,292 

1,509 

93 

1,543 

478 

64 

57,783 

1,566 

94 

1,065 

355 

65 

56,217 

1,630 

95 

710 

254 

66 

54,587 

1,703 

96 

456 

175 

67 

52,884 

1,783 

97 

281 

116 

68 

51,101 

1,872 

98 

165 

72 

69 

49,229 

1,965 

99 

93 

44 

70 

47,264 

2,060 

100 

49 

24 

71 

45,204 

2,157 

101 

25 

13 

72 

43,047 

2,250 

102 

12 

7 

73 

40,797 

2,338 

103 

5 

3 

74 

38,459 

2,417 

104 

2 

2 

159 


Table  42 — disability  pensioners'  mortality  table — men 


Living 

Dying 

Living 

D3ang 

Age 

If 

d'^ 

Age 

I'S 

40 

100,000 

3,132 

68 

28,687 

2,014 

41 

96,868 

3,168 

69 

26,673 

1,968 

42 

93,700 

3,179 

70 

24,705 

1,914 

43 

90,521 

3,202 

71 

22,791 

1,851 

44 

87,319 

3,206 

72 

20,940 

1,776 

45 

84,113 

3,215 

73 

19,164 

1,690 

46 

80,898 

3,142 

74 

17,474 

1,597 

47 

77,756 

3,063 

75 

15,877 

1,498 

48 

74,693 

2,985 

76 

14,379 

1,471 

49 

71,708 

2,903 

77 

12,908 

1,434 

50 

68,805 

2,813 

78 

11,474 

1,386 

51 

65,992 

2,720 

79 

10,088 

1,329 

52 

63,272 

2,632 

80 

8,759 

1,265 

53 

60,640 

2,534 

81 

7,494 

1,189 

54 

58,106 

2,445 

82 

6,305 

1,099 

55 

55,661 

2,353 

83 

5,206 

996 

56 

53,308 

2,263 

84 

4,210 

890 

57 

51,045 

2,177 

85 

3,320 

782 

58 

48,868 

2,095 

86 

2,538 

674 

59 

46,773 

2,022 

87 

1,864 

565 

60 

44,751 

1,950 

88 

1,299 

450 

61 

42,801 

1,937 

89 

849 

336 

62 

40,864 

1,918 

90 

513 

233 

63 

38,946 

1,983 

91 

280 

149 

64 

36,963 

2,044 

92 

131 

83 

65 

34,919 

2,102 

93 

48 

35 

66 

32,817 

2,080 

94 

13 

11 

67 

30,737 

2,050 

95 

2 

2 

160 


Table  43 — disability  pensioners'  mortality  table — women 


Living 

Dying 

Living 

Dying 

Age 

j'i' 

d'^ 

Age 

J? 

d'i* 

33 

100,000 

2,590 

69 

29,791 

1,787 

34 

97,410 

2,464 

70 

28,004 

1,773 

35 

94,946 

2,364 

71 

26,231 

1,760 

36 

92,582 

2,259 

72 

24,471 

1,747 

37 

90,323 

2,165 

73 

22,724 

1,725 

38 

88,158 

2,125 

74 

20,999 

1,701 

39 

86,033 

2,099 

75 

19,298 

1,671 

40 

83,934 

2,073 

76 

17,627 

1,639 

41 

81,861 

2,047 

77 

15,988 

1,599 

42 

79,814 

2,019 

78 

14,389 

1,554 

43 

77,795 

1,999 

79 

12,835 

1,495 

44 

75,796 

1,971 

80 

11,340 

1,429 

45 

73,825 

1,949 

81 

9,911 

1,358 

46 

71,876 

1,926 

82 

8,553 

1,268 

47 

69,950 

1,903 

83 

7,285 

1,169 

48 

68,047 

1,892 

84 

6,116 

1,055 

49 

66,155 

1,872 

85 

5,061 

937 

50 

64,283 

1,864 

86 

4,124 

821 

51 

62,419 

1,848 

87 

3,303 

707 

52 

60,571 

1,829 

88 

2,596 

594 

53 

58,742 

1,827 

89 

2,002 

490 

54 

56,915 

1,821 

90 

1,512 

398 

55 

55,094 

1,813 

91 

1,114 

315 

56 

53,281 

1,812 

92 

799 

242 

57 

51,469 

1,801 

93 

557 

180 

58 

49,668 

1,803 

94 

377 

131 

59 

47,865 

1,805 

95 

246 

91 

60 

46,060 

1,806 

96 

155 

62 

61 

44,254 

1,810 

97 

93 

40 

62 

42,444 

1,812 

98 

53 

24 

63 

40,632 

1,820 

99 

29 

14 

64 

38,812 

1,813 

100 

15 

8 

65 

36,999 

1,806 

101 

7 

4 

66 

35,193 

1,805 

102 

3 

2 

67 

33,388 

1,800 

103 

1 

1 

68 

31,588 

1,797 

Bate  of  Interest 

In  computing  the  cost  of  pensions  a  rate  of  interest  has  to  be  used  in 
combination  with  the  mortality  and  service  tables  and  the  salary  scale.  The 
assumption  of  a  rate  is  necessary  in  order  to  estimate  the  amount  of  income 
which  will  accrue  to  the  fund  as  a  result  of  the  investment  of  all  money 
which  remains  in  the  fund  for  a  period  prior  to  its  disbursement  in  pension 
payments.  It  is  desirable  to  select  a  rate  which  is  sufficiently  high  to  provide 
for  the  employees  a  fair  return  on  their  investment  and  which  at  the  same 
time  is  not  in  excess  of  the  rate  the  fund  could  be  reasonably  expected  to 
earn  over  a  long  period.  If  too  high  a  rate  be  assumed  the  estimated  interest 
will  not  be  earned,  and,  as  a  consequence,  the  contributions  of  the  employees 
will  be  insufficient  to  pay  the  pension  by  the  amount  the  interest  actually 
earned  falls  short  of  the  estimated  interest.  The  rate  of  4  per  cent,  was 
adopted  for  this  valuation,  therefore,  as  it  was  thought  that  the  city  could 
easily  guarantee  interest  on  the  fund  at  this  rate  in  view  of  the  present  and 

161 


prospective  rates  on  long  term  city  bonds.  If  in  the  future  it  becomes  Impos- 
sible for  the  city  to  guarantee  4  per  cent,  interest,  the  rate  may  be  changed 
respecting  subsequent  entrants  into  the  fund,  although  the  guarantee  could 
not  easily  be  modified  respecting  employees  who  had  made  contributions  on 
the  4  per  cent,  basis. 


Present  Value  of  Various  Benefits 

In  the  valuation  of  the  present  Habilities  of  the  fund  the  method  followed 
was  to  compute  the  present  value  of  a  prospective  pension,  under  each  Bene- 
fit allowed  in  the  law,  on  a  basis  of  one  dollar  of  salary  earned,  and  then  to 
multiply  it  by  the  salary  of  the  employees  in  the  service  today.  These  values 
were  computed  for  every  age  and  for  various  lengths  of  service  at  each  age, 
in  order  to  cover  employees  at  different  ages  with  various  lengths  of  previous 
service  at  the  time  the  valuation  was  prepared.  Examples  of  these  values, 
as  applied  to  certain  specified  entrance  salaries,  are  given  in  the  following 
tables  which  show  the  present  value  of  the  pension  benefits  for  persons  enter- 
ing the  service  at  these  salaries  at  the  ages  shown.  The  age  at  entrance  into 
the  service  is  used  in  order  that  a  simple  case  may  be  given  as  an  example. 
A  person  who  has  been  in  the  service  for  a  few  years  will  become  eligible 
for  pension  sooner  than  an  entrant  and  consequently  the  cost  of  his  pension 
benefit  is  larger. 

The  first  table  shows  the  cost  of  pensions  to  persons  entering  the  service 
on  the  average  entrance  salary.  In  the  year  1914  the  average  entrance  salary 
was  $762  per  annum  for  women  and  $1,134  for  men.  The  values  in  the  first 
table,  therefore,  show  the  present  value  of  the  pension  benefits  based  upon 
the  average  salaries  at  entrance. 


Table  44 — amount  of  money  which,  if  placed  at  4  per  cent,  com- 
pound INTEREST  AT  THE  TIME  THE  EMPLOYEE  ENTERS  THE  SERVICE, 
WILL  BE  SUFFICIENT  TO  PROVIDE  FOR  HIS  PENSION  PAYMENTS  UNDER 
THE  VARIOUS  BENEFITS  FOR  WHICH  HE  MAY  BECOME  ELIGIBLE.  COM- 
PUTED ON  THE  BASIS  OF  AN  AVERAGE  ENTRANCE  SALARY  OF  $1,134  PER 
ANNUM    FOR    MEN   AND  $762   PER   ANNUM    FOR   WOMEN 


Disability  Pension 

Service 

Pension 

Total 

Pension 

Entrance 

Age 

Men 

Women 

Men 

Women 

Men 

Women 

20 

$164 

$212 

$1249 

$762 

$1413 

$974 

25 

138 

158 

1125 

872 

1263 

1030 

30 

118 

85 

1044 

907 

1162 

992 

35 

98 

40 

974 

805 

1072 

845 

40      ' 

61 

15 

829 

619 

890 

634 

162 


The  values  in  the  first  table  do  not  furnish  figures  for  a  comparison  of 
the  relative  cost  of  benefits  for  men  and  women  in  similar  positions  since  the 
amounts  there  shown  are  for  different  entrance  salaries.  In  order  that  this 
comparison  may  be  made,  the  following  table  gives  the  cost  at  entrance  if 
both  men  and  women  are  assumed  to  start  on  an  average  salary  of  $i,ooo  per 
annum.  This  table  therefore  shows  the  relative  cost  of  the  two  pensions  in 
the  case  where  both  men  and  women  enter  on  the  same  salaries. 


Table  45 — amount  of  money  which^  placed  at  4  per  cent,  com- 
pound INTEREST  AT  THE  TIME  THE  EMPLOYEE  ENTERS  THE  SERVICE, 
WILL  BE  SUFFICIENT  TO  PROVIDE  FOR  HIS  PENSION  PAYMENTS  UNDER 
THE  VARIOUS  BENEFITS  FOR  WHICH  HE  MAY  BECOME  ELIGIBLE.  COM- 
PUTED ON  THE  BASIS  OF  AN  ENTRANCE  SALARY  OF  $I,000  PER  ANNUM 
FOR  BOTH    MEN   AND  WOMEN. 


Disability  Pension 

Service  Pension 

Total  Pension 

Entrance 

Age 

Men 

Women 

Men 

Women 

Men 

Women 

20 

$145 

$278 

$1101 

$1000 

$1246 

$1278 

25 

122 

208 

992 

1145 

1114 

1353 

30 

104 

112 

921 

1190 

1025 

1302 

35 

86 

53 

859 

1056 

945 

1109 

40 

54 

20 

731 

812 

785 

832 

Present  Active  Service  and  Pension  Rolls 

As  previously  stated,  the  present  values  of  the  various  benefits  were 
computed  upon  a  basis  of  a  salary  of  one  dollar  and  were  then  multiplied  by 
the  salaries  actually  received  by  the  employees  in  the  active  service.  The 
date  adopted  as  the  valuation  date  was  June  30,  1914,  the  date  of  the  census.. 
The  following  tables  are  summaries  of  those  actually  employed  in  the  valua- 
tion ;  the  complete  "tables  are  not  shown  in  detail  because  of  lack  of  space. 
The  table  employed  for  the  active  force,  for  example,  required  one  sheet  for 
each  age  in  order  that  salaries  of  employees  at  that  age  might  be  classified 
by  length  of  service.  As  the  data  in  the  summary  tables  have  not  been 
previously  compiled  and  published  they  are  given  here  not  only  because  they 
show  the  distribution  of  the  force  by  age  and  hence  will  be  of  assistance  in 
the  formulation  of  a  new  pension  system,  but  also  because  they  have  a 
general  statistical  value  when  the  composition  of  the  present  teaching  staff 
is  under  consideration. 

The  active  service  of  Hunter  College  has  been  kept  separate  from  the 
other  teachers  as  they  are  affected  by  certain  minimum  limitations  as  to 
pension  which  do  not  apply  to  the  general  teaching  staff.  In  the  tabulation 
for  Hunter  College,  however,  the  results  are  shown  by  five  year  groups  in 
order  to  prevent  the  publication  of  individual  records. 

163 


Table  46 — number  and  salary  of  all  regular  teachers  in  the  active 

service  classified  by  age 


Age 

Men 

Women 

Age 

Men 

Women 

No. 

Salaries 

No. 

Salaries 

No. 

Salaries 

No. 

Salaries 

18 

4    1 

$720 

46 

61 

$166,490 

280 

$524,980 

19 

«!  15 

10,800 

47 

41 

115,660 

245 

455,520 

20 

4 

$3,420 

1167 

120,440 

48 

26 

84,560 

229 

432,410 

•21 

12 

11,830 

1458 

329,830 

49 

42 

128,430 

219 

425,550 

22 

26 

23,810 

811 

586,930 

50 

26 

75,850 

169 

330,790 

28 

51 

49,690 

962 

706,750 

51 

26 

82,730 

172 

334,880 

24 

72 

76,910 

906 

688,680 

52 

33 

113,150 

131 

254,130 

25 

88 

99,810 

979 

789,560 

53 

27 

84,180 

140 

263,250 

26 

88 

111,780 

872 

759,930 

54 

26 

79,690 

162 

305,370 

27 

128 

182,910 

773 

727,590 

55 

13 

38,100 

123 

227,800 

28 

118 

180,760 

780 

785,400 

56 

20 

55,550 

93 

188,340 

29 

119 

207,860 

698 

747,770 

57 

13 

42,670 

83 

168,270 

30 

120 

217,940 

739 

833,580 

58 

17 

52,900 

50 

99,300 

31 

114 

218,480 

643 

773,690 

59 

14 

41,890 

56 

104,170 

32 

109 

212,910 

636 

808,280 

60 

16 

48,130 

48 

102,720 

33 

98 

201,890 

522 

686,250 

61 

15 

57,270 

55 

112,300 

34 

86 

187,080 

577 

819,300 

62 

15 

46,350 

31 

63,210 

35 

98 

215,650 

534 

778,320 

63 

10 

36,450 

22 

43,640 

36 

100 

226,220 

530 

788,610 

64 

12 

40,800 

32 

63,500 

37 

100 

243,800 

507 

788,480 

65 

6 

17,600 

18 

31,010 

38 

86 

211,010 

580 

933,000 

66 

3 

9,160 

12 

19,610 

39 

78 

188,440 

472 

770,760 

67 

2 

4,830 

9 

20,360 

40 

71 

183,080 

467 

772,990 

68 

6 

19,150 

5 

12,400 

41 

77 

202,430 

412 

719,900 

69 

5 

15,500 

5 

10,970 

42 

82 

213,550 

396 

680,570 

70 

6 

16,900 

4 

11,150 

43 

62 
67 

158,300 
177,610 

334 
354 

587,110 
634,630 

44 

45 

59 

163,930 

309 

572,430 

Total 

2,594 

$5,645,090 

17,827 

$22,807,930 

Table  47 — number  and  salary  of  all  hunter  college  teachers  in  the 

ACTIVE  service  CLASSIFIED  BY  AGE 


Central  Age  of  Group 

Men 

Women 

Number 

Salaries 

Number 

Salaries 

25.. 

4 

$4,560 

30.. 

i 

$'2,666 

23 

42,640 

35.. 

2 

5,500 

32 

78,450 

40.. 

3 

15,200 

37 

91,720 

45.. 

2 

7,150 

21 

52,610 

50.. 

2 

11,000 

14 

37,930 

55.. 

3 

22,000 

15 

42,870 

60.. 

1 

6,000 

5 

14,370 

65.. 

2 

3,350 

Total 

14 

$68,850 

153 

$368,500 

164 


Table  48 — number  and  salary  of  all  regular  teachers  in  the  active 
service  classified  by  length  of  service 


Total 
Years  OP 
Service 

Men 

Women 

Total 
Years  op 
Service 

Men 

Women 

No. 

Salaries 

No. 

Salaries 

No. 

Salaries 

No. 

Salaries 

o~h 

61 

$69,190 

646 

$492,640 

231-24^ 

15 

$46,420 

227 

$400,940 

§-  U 

88 

115,160 

1,190 

948,450 

24f-25§ 

14 

40,310 

192 

346,750 

li-2i 

133 

170,730 

1,461 

1,142,100 

25^26^ 

18 

60,650 

159 

300,600 

2h-3h 

147 

196,500 

813 

684,910 

26^-271 

24 

80,250 

146 

277,010 

3^-4^ 

152 

236,060 

1,058 

965,290 

27f-28i 

7 

27,050 

144 

258,180 

4f-5^ 

128 

209,800 

709 

701,670 

28§-29| 

14 

50,270 

128 

247,760 

5i-6^ 

119 

195,430 

987 

1,047,000 

29f-30^ 

7 

28,550 

141 

266,010 

6i-7i 

198 

364,570 

1,014 

1,108,030 

30I-3U 

7 

25,460 

130 

256,260 

7i-8^ 

172 

344,860 

930 

1,063,460 

31M2i 

5 

15,400 

83 

160,580 

8i-  9^ 

152 

325,190 

638 

766,900 

32f-33| 

3 

13,500 

96 

181,240 

9M0i 

169 

396,090 

577 

741,540 

331-34^ 

5 

17,950 

59 

107,200 

lOi-lli 

155 

372,660 

771 

1,077,380 

34f-35^ 

4 

12,900 

68 

137,810 

lli-12i 

81 

202,350 

582 

872,310 

35§-36| 

3 

10,500 

61 

125,530 

12f-13i 

110 

284,660 

757 

1,149,050 

36M7^ 

1 

3,500 

42 

82,090 

13M4i 

91 

242,810 

518 

828,330 

37f-38| 

3 

8,920 

42 

91,590 

14i-15i 

102 

274,370 

460 

736,130 

38f-39^ 

4 

17,000 

35 

72,260 

15i-16i 

145 

402,700 

508 

854,530 

39M0I 

1 

3,500 

30 

60,380 

16§-17i 

63 

197,250 

464 

797,750 

40f41^ 

1 

3,500 

33 

65,720 

17M8^ 

47 

135,000 

404 

680,200 

41f-42^ 

1 

3,500 

26 

53,860 

18^-19^ 

38 

109,410 

380 

650,360 

42M3^ 

3 

9,400 

19 

35,480 

19i-20i 

38 

111,510 

286 

496,110 

43M4i 

1 

3,500 

18 

36,980 

20f-2U 

17 

58,850 

228 

399,490 

Over  45 

4 

14,000 

57 

128,560 

21i-22§ 

22 

68,010 

305 

535,960 

22f-23^ 

21 

65,900 

205 

375,550 

Total.... 

2,594 

$5,645,090 

17,827 

$22,807,930 

Table  49 — number  and  salary  of  all  hunter  college  teachers  in 
the  active  service  classified  by  length  of  service 


Total  Years  of  Service 

Men 

Women 

Number 

Salaries 

Number 

Salaries 

0  and  less  than    5 

5        "         "         10 

10        "        "        15 

15        "        "        20 

20        "        "        25 

25        "         "        30 

30        "         "        35 

35        "         "        40 

40        "         "        45 

3 
5 
1 
3 

'2 

$7,700 

22,150 

5,000 

18,000 

l'6",666 

17 

58 

24 

18 

13 

13 

3 

3 

4 

$28,360 
133,930 
59,470 
46,340 
33,360 
38,400 
10,140 
7,200 
11,300 

Totals 

14 

$68,850 

153 

$368,500 

165 


Table  50 — number  and  pension  of  all  regular  teacher  pensioners 
WHO  were  retired  on  service  pensions  classified  by  age 


Age 

Men 

Women 

Age 

Men 

Women 

No. 

Pension 

No. 

Pension 

No. 

Pension 

No. 

Pension 

48 

1 

$910 

70 

1 

$1,080 

42 

$31,730 

49 

1 

910 

71 

4 

4,630 

39 

30,180 

50 

3 

3,160 

72 

4 

5,160 

46 

36,270 

51 

13 

10,900 

73 

3 

4,080 

33 

28,380 

52 

22 

18,110 

74 

5 

7,000 

26 

19,570 

53 

i 

$1,566 

23 

20,400 

75 

5 

6,180 

27 

19,910 

54 

1 

1,200 

26 

19,810 

76 

3 

4,900 

17 

12,220 

55 

36 

27,590 

77 

5 

7,700 

19 

13,420 

56 

i 

1,266 

51 

42,600 

78 

1 

1,500 

13 

11,300 

67 

46 

36,220 

79 

1 

1,500 

8 

6,820 

58 

i 

1,266 

47 

34,620 

80 

2 

2,300 

6 

4,680 

59 

47 

34,070 

81 

3 

3,660 

9 

7,360 

60 

2 

2,766 

51 

39,480 

82 

2 

2,460 

3 

2,130 

61 

2 

2,530 

61 

45,420 

83 

1 

1,500 

3 

2,900 

62 

5 

6,480 

65 

49,080 

84 

1 

1,600 

1 

880 

63 

2 

2,700 

51 

39,310 

85 

64 

1 

1,200 

50 

36,990 

86 

65 

1 

800 

61 

47,140 

87 

66 

4 

6,400 

64 

48,530 

88 

67 

42 

33,410 

89 

i 

666 

68 

3 

3,966 

54 

40,280 

90 

2 

1,510 

69 

3 

4,000 

47 

35,960 

91 

i 

1,566 

Total 

69 

$92,460 

1,157 

$894,760 

Table  51 — number  and  pension  of  all  hunter  college  pensioners  who 
were  retired  on  service  pensions  classified  by  age 


Central  Age  op  Group 

Men 

Women 

Number 

Pension 

Number 

Pension 

60 

65 

70 

76 

80 

86 

'2 

$8,666 

2 

i 
i 

$2,630 
1,256 

1,666 

Total 

2 

$8,000 

4 

$4,880 

166 


Table  52 — number  and  pension  of  all  regular  teacher  pensioners 
WHO  were  retired  on  disability  pensions  classified  by  age 


Men 

Women 

Men 

Women 

Age 

Age 

No. 

Pension 

No. 

Pension 

No. 

Pension 

No. 

Pension 

39 

3 

$2,030 

59 

1 

$1,300 

5 

$2,890 

40 

60 

3 

1,870 

41 

5 

2,936 

61 

4 

2,410 

42 

8 

5,090 

62 

5 

3,190 

43 

12 

6.950 

63 

i 

976 

2 

1,270 

44 

11 

6,280 

64 

3 

1,810 

45 

15 

9,850 

65 

5 

2,850 

46 

16 

8,670 

66 

4 

2,830 

47 

i 

$846 

11 

6,170 

67 

3 

1,590 

48 

19 

13,240 

68 

i 

6i6 

49 

2 

2,i86 

15 

9,090 

69 

50 

16 

10,070 

70 

646 

630 

51 

25 

16,150 

71 

2 

1,260 

52 

13 

7,840 

72 

630 

53 

i 

i,i36 

13 

8,450 

73 

54 

12 

6,950 

74 

660 

55 

i 

i,i66 

10 

6,100 

75 

56 

8 

5,780 

76 

596 

57 

5 

2,940 

77 

680 

58 

2 

2,490 

12 

7,130 

Total 

11 

$11,260 

270 

$166,870 

Table  53 — number  and  pension  of  all  hunter  college  pensioners 
who  were  retired  on  disability  pensions  classified  by  age 


Central  Age 

OP  Group 

Men 

Women 

Number 

Per 

ision         Number 

Pension 

45 

50 

55 

60 

65 

70 

75 

1 
1 
2 
2 
1 

.'.'.             i 

$960 
520 
2,350 
1,830 
1,000 

1,666 

Total 

8 

$7,660 

167 


Valuation  Balance  Sheets 

As  a  result  of  the  material  difference  between  the  cost  of  pensions  to 
men  and  those  to  women,  and  because  of  the  difference  in  the  law  as 
regards  the  pension  benefits  applicable  to  the  general  teaching  staff  and  those 
applicable  to  Hunter  College,  a  separate  balance  sheet  is  shown  for  men 
and  women,  in  which  a  distinction  is  made  between  teachers  in  the  Hunter 
College  and  in  the  regular  schools.  A  consolidation  of  these  two  sheets  in 
a  general  valuation  balance  sheet  showing  the  total  assets  and  liabilities  of 
the  funds  is  also  given. 


Table  54^ — valuation  of  assets  and  liabilities  of  the  school  teachers' 

retirement  fund  on  account  of  men  teachers 

valued  as  of  june  30,  i914 


Liabilities 

Assets 

Item 

Present 
Value  of 
Payments 

to  be 

Made 

Item 

Present 
Value  of 
Payments 

to  be 
Received 

Pension  to  82  persons  now  on  the 
tension  roll  of  the  fund  as  fol- 

$588,850 
25,760 

107,850 

Proportion  of  funds  in  hand  cred- 
itable to: 
Regular  Teachers 

$172,480 
2,110 

Service  Pensioners: 

69  Regular  Teachers 

Hunter  College  Teachers 

Employees'    contribution  of  one 
percentum    of   future   salaries 
from  2,608  members   now  in 
active  Service: 

2,594  Regular  Teachers 

2  Hunter  College  Teachers. . 

Disability  Pensioners: 

1 1  Regular  Teachers 

Hunter  College  Teachers . . 

993,000 
7,125 

14  Hunter  College  Teachers . . 

Proportion     of     future      excise 
moneys  and  net  absence  deduc- 
tions creditable  to: 

Regular  Teachers 

Total  pensions  entered  upon .... 

$722,460 

Pensions  to  such  persons  as  retire 
on  pension  from  the  present 
active  service  of  2,608  mem- 
bers as  follows: 
Service   Pensions,    to   Survivors 
Among: 

2,594  Regular  Teachers 

14  Hunter  College  Teachers 

Disability   Pensions   to   Persons 
Becoming  Disabled  Among: 

2,594  Regular  Teachers 

14  Hunter  College  Teachers 

$6,481,700 
110,050 

721,950 
8,400 

*2,373,480 

Hunter  College  Teachers.  .  . 

Deficiency  on  Account  of: 

Regular  Teachers 

*     17,030 
4,361,390 

Hunter  College  Teachers. . . . 

117,945 

Total  pensions  not  entered  upon. . 

$7,322,100 

Grand  Total 

$8,044,560 

Grand  Total 

$8,044,560 

*See  note  to  table  on  page  170. 


168 


Table  55 — valuation  of  assets  and  liabilities  of  the  school  teachers' 

retirement  fund  on  account  of  women  teachers 

valued  as  of  june  30,  i914 


Liabilities 

Assets 

Item 

Present 

Value  of 

Payments 

to  be 

Made 

Item 

Present 
Value  of 
Payments 

to  be 
Received 

Pension  to  1,439  persons  now  on 
the  pension  roll  of  the  fund,  as 
follows : 

18,835,000 
44,450 

1,902,950 
76,350 

Proportion  of  funds  in  hand  cred- 
itable to: 

Regular  Teachers 

$696,875 
11,250 

3,140,350 
43,250 

Service  Pensioners: 

1,157  Regular  Teachers 

4  Hunter  College  Teachers 

Disability  Pensioners: 

270  Regular  Teachers 

8  Hunter  College  Teachers. . 

Hunter  College  Teachers . . . 

Employees'    contribution  of  one 

percentum    of   future   salaries 

from  17,980  members  now  in 

actice  service  as  follows: 

17,827  Regular  Teachers.. . . 

153       Hunter       College 

Total  pensions  entered  upon 

$10,858,750 

Proportion      of      future      excise 
moneys  and  net  absence  deduc- 
ductions  creditable  to: 

Regular  Teachers 

Pension  to  such  persons  as  retire 
on  pensions  from  the  present 
active  service  of  17  980  mem- 

142,319,100 
731,925 

7,764,800 
90,625 

♦7,506,110 
*   103,380 

49,478,515 
785,470 

bers  as  follows: 
Service    Pensions    to    Survivors 
Among: 

17,827  Regular  Teachers 

153  Hunter  CoUege  Teach- 
ers   

Hunter  College  Teachers 

Deficiency  on  Account  of: 

Regular  Teachers 

Hunter  College  Teachers 

Disability  Pension  to  Persons  Be- 
coming Disabled  Among: 

17,827  Regular  Teachers 

153  Hunter  College  Teach- 
ers   

Total  pensions  not  entered  upon. . 

$50,906,450 

Grand  Total   

$61,765,200 

Grand  Total 

$61,765,200 

*See  note  to  table  on  page  170. 


169 


Table  56 — valuation  of  the  total  assets  and  liabilities  of  the  school 
teachers'  retirement  fund 

valued  as  of  JUNE  30,    I914 


LlABILltlES 

Assets 

Item 

Present 

Value  of 

Payments 

to  be 

Made 

Item 

Present 
Value  of 
Payments 

to  be 
Received 

Regular  or  Service  pensions  to 

$9,494,060 
2,087,150 

Total  funds  in  hand 

$882,715 
4,183,725 

1,232  persons  now  on  the  rolls 
of  the  fund  who  draw  pensions 
of  $1,000,100  annually 

Disability  pensions  to  289  per- 
sons now  on  the  rolls  of  the 
fund   who   draw   pensions   of 
$185,790  annually 

One  percentum  of  future  salaries 
of  20,588  members  of  present 
active  force  now  drawing  sal- 
aries of  $28,890,370  annuaUy . . 

Proportion  of  future  excise  tax 
and    net    absence    deductions 

♦10,000,000 
54,743,320 

Total  pensions  entered  upon 

$11,581,210 

Regular  service  pensions  to  such 
persons  as  retire  from  the  pres- 
ent active  service  roll  of  20,588 
persons  who  draw  salaries  of 
$28,890,370  annually 

149,642,775 

8,585,775 

Disability  pensions  to  such  other 
persons  as  become  disabled  and 
retire  from  the  present  active 
service  roll 

Total  pensions  not  entered  upon. 

$58,228,550 

Grand  Total 

$69,809,760 

Grand  Total 

$69,809,760 

Percentage  of  Salaries  Required  to  Pay  Pensions  to  Future  Entrants 

The  cost  of  the  present  pension  fund,  expressed  as  the  percentage  of  the 
employee's  salary  which  would  be  required  as  a  contribution  in  order  to  pro- 
vide the  benefits  allowed,  is  shown  in  the  following  table.  Details  of  the 
contribution  are  given,  showing  the  portion  of  the  total  contribution  which 
is  required  to  pay  for  disability  pension  and  the  portion  required  for  service 
pension. 


*The  total  future  excise  moneys  and  absence  deductions  which  can  be  credited  to  persons  now  in  service 
or  on  pension  will  be  probably  less  than  the  amount  shown.  These  two  sources  of  revenue  are  decreasing  and 
no  definite  basis  for  estimating  their  value  is  available. 


170 


Table  57 — rates  of  contribution,  expressed  as  percentages  of  salaries, 
necessary  to  pay  for  the  various  pension  benefits  allowed  by  the 

pension   PROVISIONS  OF  THE  TEACHERS'  RETIREMENT  FUND 


Men 

Women 

Age  at  Entry 

Disability 
Pension 

After  20 
Years 
Service 

Service 
Pension 
After  30 
Years 
Service 

Total 

AU 

Pensions 

Disability 

Pension 

After  20 

Years 

Service 

Service 
Pension 
After  30 
Years 
Service 

Total 

All 

Pensions 

20 

.40 
.41 
.42 
.42 
.43 
.43 
.44 
.44 
.45 
.45 
.45 
.45 
.46 
.45 
.45 
.43 
.42 
.40 
.37 
.34 
.31 

3.05 
3.13 
3.22 
3.31 
3.40 
3.50 
3.60 
3.69 
3.79 
3.88 
3.96 
4.04 
4.10 
4.16 
4.19 
4.20 
4.19 
4.16 
4.10 
4.00 
3.89 

3.45 
3.54 
3.64 
3.73 
3.83 
3.93 
4.04 
4.13 
4.24 
4.33 
4.41 
4.49 
4.56 
4.61 
4.64 
4.63 
4.61 
4.56 
4.47 
4.34 
4.20 

1.41 

1.40 

1.36 

1.30 

1.22 

1.13 

1.03 

.93 

.83 

.73 

.64 

.57 

.51 

.45 

.40 

.35 

.30 

.26 

.23 

.19 

.16 

5.08 
5.31 
5.54 
5.76 
5.95 
6.12 
6.27 
6.39 
6.47 
6.52 
6.54 
6.52 
6.47 
6.40 
6.29 
6.16 
6.00 
5.63 
5.61 
5.40 
5.16 

6  49 

21 

6  71 

22 

6.90 

23 

7  06 

24 

7  17 

25 

7  25 

26 

7  30 

27 

7  32 

28 

7  30 

29 

7  25 

30 

7  18 

31 

7  09 

32 

6  98 

33 

6.85 

34 

6.69 

35 

6  51 

36 

6  30 

37 

5  89 

38 

5  84 

39 

5  59 

40 

5  32 

171 


CHAPTER  XIII. 
VALUATION  OF  FUND  UNDER  PROPOSED  PENSION  PLAN 

Benefits  and  Contributions 

The  pension  plan  proposed  in  Part  I  of  this  report  provides  for  the 
following  benefits  and  contributions : 

Benefits: 

Superannuation. — Pension  at  age  65  of  i^  per  cent,  of  average 
salary  of  last  ten  years  for  each  year  of  service.  Minimum  Annuity — 
30  per  cent,  of  average  salary  of  last  ten  years. 

Disability. — Pension  at  any  time*  of  i  per  cent  of  average  salary 
of  last  ten  years  for  each  year  of  service.  Minimum — 30  per  cent,  of 
average  salary  of  last  ten  years. 

Withdrazval. — Return  of  total  contribution  to  pension  fund,  with 
interest  at  4  per  cent,  to  employees  leaving  the  service  by  death,  dis- 
missal or  resignation. 

Contributions  : 

Equal  contributions  from  employees  and  city  of  amounts  suffi- 
cient to  provide  benefits  allowable.  Maximum  Contribution — 8  per 
cent,  of  salary  in  case  of  employees'  contribution  only. 


Tables  Used  as  Basis  for  Valuation  of  Proposed  Fund 

In  computing  the  cost  of  the  proposed  pension  plan  the  active  service 
tables  developed  for  use  in  valuing  the  present  pension  fund  were  employed 
after  certain  modifications  had  been  made.  The  disability  rates  used  in  valu- 
ing the  existing  fund  had  been  developed  from  the  experience  of  that  fund 
operating  under  a  system  in  which  disability  pensions  were  not  allowed  until 
after  20  years  of  service.  As  the  proposed  plan  permits  disability  retirement 
after  any  period  of  service,  the  original  disability  rate  had  to  be  modified  so 
that  it  would  cover  cases  of  disability  occurring  among  employees  who  have 
had  less  than  20  years'  service.  This  modification  was  accomplished  by 
continuing  the  disability  curves  for  men  and  women  down  to  age  20  by 
means  of  extrapolation.  Comparison  with  similar  curves  in  other  pension 
funds  was  used  as  a  basis  for  extending  the  rates  through  so  many  ages. 
The  increases  in  the  rates  of  disability  were  deducted  from  the  rates  of 

*  The  preliminary  plan  provided  for  disability  retirement  after  any  period  of  service.  Subse- 
ijuently  the  minimum  lo-year  service  limitation  was  added  as  a  proper  safeguard  to  the  fund.  To 
avoid  delay  in  the  publication  of  this  report,  no  change  in  the  original  cost  calculation  has  been  made. 
The  necessary  slight  adjustments  in  rates  will  be  made  when  the  cost  of  the  final  plan  is  calculated 
in  all  its  details. 

172 


withdrawal  because  of  resignation  and  dismissal  used  in  the  first  table,  on  the 
assumption  that  persons  who  had  been  disabled  in  former  years  had  ordi- 
narily left  the  service  without  pension.  The  following  table  shows  the  new 
rates  of  disability  and  withdrawal,  which  were  employed : 


Table  58 — ^adopted  rates  of  withdrawal  and  disability  used  in  valua- 
tion OF  proposed  fund  in  place  of  corresponding  rates  developed 

FROM   experience  UNDER  PRESENT  FUND 


Men 

Women 

Age 

Men 

Women 

Age 

With- 

Disa- 

With- 

Disa- 

With- 

Disa- 

With- 

Disa- 

drawal 

bility 

drawal 

bility 

drawal 

biUty 

drawal 

bility 

18 

.0007 

.0005 

.0020 

.0005 

42 

.0060 

.0007 

.0058 

.0088 

19 

.0042 

.0005 

.0049 

.0005 

43 

.0056 

.0007 

.0044 

.0103 

20 

.0105 

.0005 

.0097 

.0005 

44 

.0052 

.0007 

.0034 

.0110 

21 

.0221 

.0005 

.0170 

.0005 

45 

.0049 

.0008 

.0027 

.0113 

22 

.0266 

.0005 

.0253 

.0005 

46 

.0046 

.0008 

.0022 

.0114 

23 

.0279 

.0005 

.0450 

.0005 

47 

.0041 

.0008 

.0018 

.0114 

24 

.0285 

.0005 

.0576 

.0005 

48 

.0037 

.0009 

.0015 

.0112 

25 

.0286 

.0005 

.0608 

.0005 

49 

.0033 

.0009 

.0014 

.0106 

26 

.0280 

.0005 

.0616 

.0005 

50 

.0029 

.0010 

.0013 

.0090 

27 

.0270 

.0005 

.0600 

.0006 

51 

.0026 

.0010 

.0012 

.0081 

28 

.0257 

.0005 

.0573 

.0006 

52 

.0023 

.0013 

.0011 

.0077 

29 

.0232 

.0005 

.0535 

.0006 

53 

.0020 

.0018 

.0010 

.0074 

30 

.0211 

.0005 

.0492 

.0006 

54 

.0017 

.0023 

.0010 

.0073 

31 

.0190 

.0005 

.0439 

.0006 

55 

.0014 

.0028 

.0009 

.0072 

32 

.0170 

.0005 

.0377 

.0007 

56 

.0012 

.0033 

.0008 

.0071 

33 

.0149 

.0005 

.0315 

.0007 

57 

.0010 

.0038 

.0007 

.0071 

34 

.0135 

.0006 

.0255 

.0008 

58 

.0008 

.0043 

.0007 

.0071 

35 

.0120 

.0006 

.0210 

.0008 

59 

.0005 

.0049 

.0006 

.0071 

36 

.0103 

.0006 

.0173 

.0009 

60 

.0003 

.0056 

.0005 

.0071 

37 

.0092 

.0006 

.0145 

.0011 

61 

.0001 

.0064 

.0004 

.0070 

38 

.0081 

.0006 

.0127 

.0016 

62 

.0073 

.0003 

.0069 

39 

.0075 

.0006 

.0106 

.0029 

63 

.0082 

.0002 

.0068 

40 

.0069 

.0006 

.0089 

.0045 

64 

.0080 

.0001 

.0065 

41 

.0064 

.0007 

.0072 

.0064 

173 


Valuation  Balance  Sheet 

The  following  table  shows  the  valuation  of  the  assets  and  liabilities  of 
the  fund  as  they  would  have  been  on  June  30,  19 14,  had  the  new  system 
gone  into  effect  on  that  date : 

Table  59 — valuation  of  the  total  assets  and  liabilities  of  the  school 
teachers'  retirement  fund  under  the  proposed  pension  law 

VALUED  as  of  JUNE  30,   I914 


Liabilities 

Assets 

Item 

Present 

Value  of 

Payments 

to  be 

made 

Item 

Present 
Value  of 
Payments 

to  be 
Received 

Regular  or  service  pensions  to 
1,232  persons  now  on  rolls  of 
the  fund  who  draw  pensions 
of  $1,000,100  annuaUy 

Disability  pensions  to  289  per- 
sons now  on  rolls  of  the  fund 
who  draw  pensions  of  $185,- 
790  annually 

• 
$9,494,060 

2,087,150 

Total  funds  in  hand 

$882,715 
22,108,950 

Contributions  of  20,588  persons 
of  present  active  force  now 
drawing  salaries  of  $28,890,- 
370  annually 

Contributions    of   City    equal 
to  normal  contributions  of 

13,022,825 

Total  pensions  entered  upon. . . 

$11,581,210 

Deficiency,  caused  by  limita- 
tion of  employees'  contribu- 
tions and  because  of  inade- 
quate provisions  to  pay  pres- 
ent pensions,  to  be  covered 
by  additional  appropriations 
by  the  City 

Service  pensions  to  such  per- 
sons as  retire  at  age  65  or 
over  from  the  present  active 
service  roll  of  20,588  persons 
who   draw  salaries  of  $28,- 
890,370  annually 

$40,862,275 
7,365,200 

4,105,235 

27,899,430 

Disability  pensions  to  such  per- 
sons as  become  disabled  and 
retire  from  the  present  active 
service  roll 

Payments  to  persons  now  in 
the  service  who  may  leave 
without    pension  and  with- 
draw their  contributions  to 
the  fund 

Prospective  payments  to  per- 
sons now  in  active  service. .  . 

$52,332,710 

Grand  Total 

$63,913,920 

Grand  Total 

$63,913,920 

Percentage  of  Salaries  Required  to  Pay  Pensions  to  Future  Entrants 

The  following  table  shows  the  percentage  of  salary  that  will  be  required 
as  a  contribution  from  employees  entering  after  the  establishment  of  the 
suggested  fund  to  pay  half  the  cost  of  the  pension  benefits  allowed.  If  com- 
parison be  made  between  the  rates  given  in  this  table  and  the  rates  required 

174 


for  entrance  under  the  old  fund,  as  shown  on  page  171,  the  rates  in  the  pres- 
ent table  must  be  doubled.  This  table  shows  the  rate  of  contribution  re- 
quired to  pay  for  only  half  the  cost  of  the  benefit  allowed  under  the  new 
plan,  whereas  the  table  on  page  171  shows  the  rate  required  to  pay  the  full 
cost  of  the  benefits  allowed  under  the  existing  system. 

Table  60 — contributions,  expressed  as  a  percentage  of  salary  paid,  re- 
quired OF  entrants  in  order  that  they  may  pay  half  the  cost 
OF  the  pension  benefits  allowed  to  them 


Men 

Women 

For 

■    For 

Entrance 

For 
Disa- 
bility 
Pension 

Returning 

For 
Disa- 
bility 
Pension 

Returning 

Age 

For 
Service 

Contri- 
butions on 

Total 

For 
Service 

Contri- 
butions on 

Total 

Pension 

With- 
drawal or 

Pension 

With- 
drawal or 

Death 

Death 

20 

1.98 

.19 

.35 

2.52 

1.70 

.53 

.53 

2.76 

21 

2.00 

.19 

.34 

2.53 

1.75 

.55 

.51 

2.81 

22 

2.01 

.19 

.33 

2.53 

1.80 

.57 

.50 

2.87 

23 

2.03 

.19 

.32 

2.54 

1.85 

.59 

.49 

2.93 

24 

2.04 

.19 

.32 

2.55 

1.90 

.61 

.48 

2.99 

25 

2.07 

.19 

.30 

2.56 

1.95 

.64 

.46 

3.05 

26 

2.09 

.19 

.30 

2.58 

2.00 

.67 

.44 

3.11 

27 

2.11 

.20 

.29 

2.60 

2.05 

.70 

.43 

3.18 

28 

2.14 

.20 

.28 

2.62 

2.10 

.73 

.42 

3.25 

29 

2.17 

.20 

.28 

2.65 

2.15 

.76 

.41 

3.32 

30 

2.20 

.21 

.27 

2.68 

2.21 

.79 

.40 

3.40 

31 

2.24 

.21 

.26 

2.71 

2.27 

.83 

.39 

3.49 

32 

2.28 

.21 

.26 

2.75 

2.32 

.87 

.39 

3.58 

33 

2.31 

.22 

.25 

2.78 

2.38 

.91 

38 

3.67 

34 

2.36 

.22 

.25 

2.83 

2.44 

.96 

.37 

3.77 

35 

2.40 

.23 

.24 

2.87 

2.50 

1.01 

.37 

3.88 

36 

2.44 

.24 

.24 

2.92 

2.57 

1.06 

.37 

4.00 

37 

2.49 

.25 

.23 

2.97 

2.64 

1.12 

.37 

4.13 

38 

2.53 

.26 

.23 

3.02 

2.71 

1.18 

.37 

4.26 

39 

2.58 

.26 

.23 

3.07 

2.79 

1.24 

.37 

4.40 

40 

2.63 

.27 

.23 

3.13 

2.87 

1.29 

.37 

4.53 

Contributions  Required  from  Employees  Now  in  Service 

The  following  tables  show  the  contributions  required,  by  the  suggested 
plan,  from  employees  now  in  active  service.  The  zigzag  lines  running 
through  the  tables  indicate  the  points  at  which  the  maximum  limitations  pre- 
scribed by  the  plan  become  effective.  All  contributions  shown  in  the  part 
of  the  table  below  these  lines  are  by  their  maximum  limitations  reduced  to  a 
flat  rate  of  8  per  cent. 


175 


Table  6i — total  contributions,  expressed  as  a  percentage  of  salary 

PAID,  required  of  EMPLOYEES,  IN  ORDER  THAT  THEY  MAY  PAY  ONE- 
HALF  THE  COST  OF  THE  PENSION  BENEFITS  ALLOWED  TO  THEM — RATES 
GIVEN  ACCORDING  TO  PRESENT  AGE  AND  LENGTH  OF  SERVICE 

RATES  FOR  MEN 


Present 

Years 

OF  Service  Credited  Toward  Pension 

Age 

2  Years 

7  Years 

12  Years 

17  Years 

22  Years 

27  Years 

37  Years 

20 

2.63 

21 

2.64 

22 

2.65 

23 

2.66 

24 

2.67 

25 

2.68 

3.00 

26 

2.70 

3.03 

27 

2.73 

3.06 

28 

2.76 

3.10 

29 

2.79 

3.14 

30 

2.82 

3.19 

3.66 

31 

2.86 

3.24 

3.63 

32 

2.90 

3.30 

3.70 

33 

2.95 

3.36 

3.78 

34 

3.00 

3.43 

3.86 

35 

3.05 

3.60 

3.96 

4.42 

36 

3.10 

3.67 

4.05 

4.64 

37 

3.16 

3.65 

4.16 

4.67 

38 

3.22 

3.74 

4.27 

4.80 

39 

3.29 

3.83 

4.33 

4.96 

40 

3.36 

3.92 

4.61 

5.10 

6.71 

41 

3.43 

4.03 

4.64 

6.27 

6.91 

42 

3.50 

4.14 

4.79 

5.45 

6.13 

43 

3.58 

4.26 

4.94 

5.64 

6.36 

44 

3.81 

4.39 

5.11 

6.86 

6.62 

45 

4.06 
4.36 

4.53 
4.68 

6.30 
5.51 

6.09 
6.36 

6.90 

7.22 

7.73 

46 

8.10 

47 

4.67 

4.84 

6.73 

6.64 

7.57 

8  51 

48 

6.04 
6.45 

5.04 
5.45 

6.00 
6.29 

6.97 
7.34 

7.97 

8.99 
9.52 

49 

8.42 

50 

6.93 

5.93 
6.48 

6.61 
6.98 

7.76 

8.93 
9.51 

10.12 
10.81 

51 

8.23 

52 

7.13 

7.40 

8.78 

10.17 

11.61 

53 

7.88 

7.88 

9.41 
10.14 

10.95 
11.85 

12.53 
13.61 

54 

8.77 

8.77 

65 

9.86 

9.85 

11.00 

12.92 

14.89 

18.94 

56 

11.16 

12.03 

14.22 

16.45 

21.03 

67 

12.80 

13.30 

15.82 

18.38 

23.64 

58 

14.91 

14.91 

17.86 

20.86 

26.98 

69 

17.73 

17.73 

20.65 

24.11 

31.42 

60 

21.68 

21.68 

24.29 

28.66 

37.61 

61 

27.64 

29.87 

35.44 

46.87 

62 

37.68 

39.11 

46.75 

62.30 

63 

57.63 

67.53 

69.30 

93.09 

64 

117.42 

117.42 

136.79 

185.63 

176 


Table  62 — total  contributions,  expressed  as  a  percentage  of  salary 

PAID,    required    of    EMPLOYEES,    IN    ORDER    THAT    THEY    MAY    PAY   ONE- 
HALF  THE  COST   OF  THE   PENSION    BENEFITS   ALLOWED   TO   THEM RATES 

GIVEN  ACCORDING  TO  PRESENT  AGE  AND  LENGTH  OF  SERVICE 
RATES  FOR  WOMEN 


Years  of  Service  Credited  Toward  Pension 

Present 

Age 

2  Years 

7  Years 

12  Years 

17  Years 

22  Years 

27  Years 

37  Years 

20 

2.87 

21 

2.92 

22 

2.98 

23 

3.04 

24 

3.11 

25 

3.17 

3.49 

26 

3.24 

3.57 

27 

3.31 

3.65 

28 

3.39 

3.75 

29 

3.47 

3.83 

30 

3.55 

3.91 

4.32 

31 

3.64 

4.03 

4.44 

32 

3.74 

4.15 

4.57 

33 

3.84 

4.26 

4.70 

34 

3.95 

4.39 

4.85 

35 

4.07 

4.54 

5.02 

5.52 

36 

4.20 

4.69 

5.19 

5.72 

37 

4.33 

4.85 

5.39 

5.94 

38 

4.49 

5.04 

5.60 

6.18 

39 

4.64 

5.22 

5.82 

6.43 

40 

4.78 

5.40 

6.04 

6.69 

7.38 

41 

4.92 

5.59 

6.26 

6.95 

7.68 

42 

5.04 
5.13 

5.76 
5.90 

6.48 
6.68 

7.21 
7.46 

7.98 

43 

8.28 

44 

5.37 

6.04 

6.87 

7.71 

8  58 

45 

5.63 
5.91 

6.17 
6.30 

7.06 
7.27 

7.97 

8.90 
9.24 

9.89 
10.30 

46 

8.24 

47 

6.23 

6.44 

7.49 

8.54 

9.62 

10.75 

48 

6.58 

6.58 

7.73 

8.87 

10.04 

11.26 

49 

6.99 

7.47 

6.99 

7.47 

7.99 

9.24 

9.66 

10.17 

10.51 
11.05 
11.69 

11.82 
12.47 
13.24 

50 

8.29 
8.66 

51 

8.06 

52 

8.76 

9.10 

10.76 

12.44 

14.15 

53 

9.60 

9.60 

11.46 

13.32 

15.21 

54 

10.62 

10.62 

12.28 

14.36 

16.47 

55 

11.85 

11.85 

13.26 

15.60 

17.97 

22.84 

56 

13.38 

14.44 

17.12 

19.81 

25.32 

57 

15.30 

15.92 

19.00 

22.10 

28.42 

58 

17.80 

17.80 

21.41 

25.04 

32.40 

59 

21.16 

21.16 

24.62 

28.94 

37.71 

60 

25.89 

25.89 

29.08 

34.39 

45.13 

61 

33.02 

35.74 

42.54 

56.25 

62 

44.92 

46.78 

56.07 

74.74 

63 

68.77 

68.77 

83.04 

111.65 

64 

140.46 

140.46 

163.83 

222.31 

177 


HOME  USE 

CIRCULATION  DEPARTMENT 

MAIN  LIBRARY 

This  book  is  due  on  tiie  last  date  stamped  below. 
1-montii  loans  may  be  renewed  by  calling  642-3405. 
6-month  loans  may  bo  recharged  by  bringing  books 

to  Circulation  Desk. 
Renewals  and  recharges  may  be  made  4  days  prior 

to  due  date. 

ALL  BOOKS  ARE  SUBJECT  TO  RECALL  7  DAYS 

AFTER  DATE  CHECKED  OUT. 


r,iP. 


m  2  5  *T5 


LD21 — A-40TO-12, 
(S2700L,) 


74 


General  Library 

University  of  California 

Berkeley 


VD   14023 


